The Opening Belle

The overnight risk tone remains broadly positive, as Trump returned to the White House, and stimulus optimism continues.  

U.S. futures are relatively flat

European markets are set to open slightly in the green

 European Opening Calls:#FTSE 5953 +0.18%#DAX 12855 +0.21%#CAC 4882 +0.20%#AEX 560 +0.29%#MIB 19315 +0.26%#IBEX 6854 +0.23%#OMX 1843 +0.17%#STOXX 3228 +0.24%#IGOpeningCall— IGSquawk (@IGSquawk) October 6, 2020 

Stimulus talks will continue today with Pelosi & Mnuchin due to speak again this afternoon.

 Speaker Pelosi and Secretary Mnuchin spoke by phone today at 11:30 a.m. for approximately 1 hour. The two discussed the justifications for various numbers and plan to exchange paper today in preparation for another phone call tomorrow.— Drew Hammill (@Drew_Hammill) October 5, 2020 

If/when they reach an agreement, members will be recalled at 24 hours notice for the vote.

 B) McConnell: "Members will receive 24 hours’ notice for any votes before Oct 19. Otherwise senate will meet on Oct 19. The people's business does not come to a halt as members are absent on the floor"— Chad Pergram (@ChadPergram) October 5, 2020 

RBA were very clear that there will be a strong focus on employment going forward.

The Board is committed to do what it can to support jobs, incomes and businesses in Australia.

Its actions, including last month's decision to expand the Term Funding Facility, are keeping funding costs low and assisting with the supply of credit.

The Board views addressing the high rate of unemployment as an important national priority.

It will maintain highly accommodative policy settings as long as is required and will not increase the cash rate target until progress is being made towards full employment and it is confident that inflation will be sustainably within the 2–3 per cent target band.

The Board continues to consider how additional monetary easing could support jobs as the economy opens up further.

Other than keeping that sweet liquidity flowing and ensuring easy access to credit, there's not much the RBA can do.

This is a problem that requires a fiscal solution.  

Today's budget announcement (at 09:30BST) will be keenly watched for pro-jobs policies.  

The government has pledged A$314 billion ($225.8 billion) of fiscal stimulus to soften the economic blow, and Frydenberg said the budget will include sweeteners aimed at lowering unemployment.

“I will lay out our economic recovery plan to rebuild the Australian economy,” Frydenberg told reporters in Canberra.

“It’s all about helping those who are out of a job get into a job. It’s all about helping those that are in work, stay in work.”

Global unemployment is bound to remain high for some time.

This saga still has a lot of room to run;

Looking ahead, the Australian budget is arguably the highlight of the morning. German factory orders and European construction PMI's are due.

This afternoon, U.S & Canadian trade data, U.S. Redbook retail sales, and August JOLTS.

A relatively light data day, but plenty of central bankers as usual.

Everyone's favourite owl kicks things off with a pre-recorded speech at 09:35, and another appearance at 14:00.

However, the main speaking event of the day takes place at the National Association for Business Economics (NABE).

Although the header looks like it should feature David Icke, Alex Jones & a gold bug, it is actually a serious event.

Fed chair Powell will be speaking at 15:30, followed by the ECB's Lane at 16:30.

Fed's Harker, Bostic & Kaplan round things off.

The EIA will also release their Short Term Energy Outlook at 17:00.