The Monday note - 10 July 2017

• The FTSE 100 closed on Friday at 7,350.9, up 38 points on a week ago as confidence in the outlook for the global economy outweighed concerns over growth in the UK. The ten year Gilt yield stood at 1.31%. 
• Japan and the EU announced they had agreed an outline free trade treaty, while President Trump said the US and UK could “very, very quickly” broker a trade deal after Brexit. 
• The US economy saw 222,000 jobs created in June, beating Wall Street forecasts of 178,000. However, the unemployment rate ticked up slightly to 4.4%. 
• Volvo said that by 2019 all its new cars would be either fully or partially electric powered. The news comes as Tesla begins production of its first mass market car. 

Chief Economist comments: 

The twists and turns on Brexit continue. The weekend press brought cheer for Brexiteers with Trump’s comments on a future trade deal. Remainers will take heart from reports today that Prime Minister May is courting the opposition parties for support – something which hints at a softer Brexit. Actually, a trade deal with the US is less of a big deal than one would imagine, as America is a very open country to do business with, even without a deal. This is why the government is widening its options in Parliament. On Brexit, pragmatism is still needed.