A look at the day ahead in European and global markets from

Wayne Cole.

The early action Monday has been in currencies as the dollar

took a knock from a new poll in Iowa showing Democratic

presidential contender Kamala Harris leading Republican Donald

Trump. That was enough to see the dollar down 0.9% on the yen

and 0.6% on the euro, while the trade-sensitive Aussie bounced

0.8%.

Analysts tend to assume Trump's policies on immigration,

tariffs and tax cuts would put a lot more upward pressure on the

U.S. dollar and yields, than a Harris victory.

Of particular note was the Des Moines Register/Mediacom Iowa

Poll which surprised everyone by showing Harris up 3 points on

Trump in the state, a major shift from a few weeks ago. This

poll has a very good track record and is considered a bellwether

for votes across the swing states.

"Since last week, Harris is seeing a boost in the polls,

highlighted by the Selzer Poll of Iowa where some are using as a

proxy for performance among the Blue Wall battleground states

(Michigan, Pennsylvania and Wisconsin)," JPMorgan said in a

note.

Betting site PredictIT showed Harris at 53 cents to Trump on

51 cents - what investors are willing to wager for a chance to

win $1 - compared to 42 cents to 61 cents just a week ago.

The average of opinion polls is still too close to call and

it's quite possible the result of the vote may not be known on

Wednesday. In 2020, for instance, Pennsylvania was not called

until the Saturday after the election. There could also be court

challenges to results which might drag on for weeks.

Markets assume the Federal Reserve will go ahead and cut

rates on Thursday no matter the outcome, with futures implying a

98% chance of 25 basis points. They are also pricing an 80%

probability of another quarter point in December, though that

could easily change depending on who becomes president-elect.

The Bank of England is also expected to cut by a quarter

point on Thursday, while the Riksbank is seen easing by 50 basis

points. Norges Bank and the Reserve Bank of Australia (RBA) are

seen on hold this week.

The other market mover on Monday was oil, which bounced 1.4%

or so after OPEC+ said on Sunday it would delay a planned

December output hike by one month. This was the second time it

has extended a 2.2 million bpd cut and only goes to show how

worried they are about global demand.

Asia in particular has been weak with crude imports in the

first 10 months of the year down 200,000 bpd from the same

period in 2023, according to LSEG data.

Key developments that could influence markets on Monday:

- Participation by ECB President Christine Lagarde and ECB

Board Member Piero Cipollone in Eurogroup meeting

- ECB members appearing include Elizabeth McCaul, Frank

Elderson, Christodoulos Patsalides and Claudia Buch

- Final EZ manufacturing PMIs for October

- U.S. durable goods, factory orders for September