general election

Dow futures are up some 80 points this morning after early on Wednesday morning the Senate passed the Tax Reform bill in a party-line vote, and is now set to become law after a follow-up vote in the House and Trump's signature some time on Wednesday afternoon. The good news is that the biggest political drama of 2017 will then be over. The bad news is that once the bill becomes law, the market will no longer be able to "price it in" every single day as it has for the past year.

One of the traditional push backs against attempts to predict "black swan" events is that they are by default unpredictable, rendering the entire exercise moot. However, for the second year in a row, Nomura's Bilal Hafeez has found a loophole, or rather loop-animal: the grey swan.

Two days after Prime Minister Paolo Gentiloni's one-year anniversary of taking the country's top job, Italy's political parties have reached an agreement on when next year's election will be held, according to Italian media reports, with the news prompting a selloff across Italian assets. According to local press, President Sergio Mattarella will dissolve parliament this month and set a March 4 election date.

E-mini futures are modestly in the green this morning, though net of fair value the S&P index is poised for another record high open as the FOMC begins its last meeting for 2017 in which it is expected to raise rates by 25bps. European stocks gain while Asian equities slide led by weakness in Chinese airplane stocks.

After last week's payrolls report, the year is starting to wind down for economic events and capital markets, but not before one last hurrah for central banks: indeed, it is a very busy week dominated by central bank meetings for the FOMC, ECB, BOE, SNB and Norges Bank. We will also observe the controversial Alabama Senate elections and the EU Council summit on the state of Brexit negotiations. Data-wise, the most important economic update will be Wednesday's US CPI print, as well as industrial production releases in a number of countries including the US and China.