Turning to US Q3 GDP

Signs that China could participate in EFSF; German CPI could surprise on the upside; UK CBI sales better than anticipated. Market turns to Q3 GDP, jobless claims and pending home sales.

Riskier assets continue to push higher on the back of yesterday's EU summit that produced some concrete steps towards the resolution of the EU debt crisis and thus satisfied market's expectations. European equity indices are in positive territory and the greenback continues to decline across the board.

Also supporting the sentiment were comments by the Chinese foreign minister who said that China is willing to help protecting financial stability and global growth. Such comments increase the probability that French president Sarkozy who will talk with Chinese leader Hu Jintao today, will be successful in convincing China to participate in the EFSF.

German preliminary October CPI is seen unchanged from last month at 0.1% which translates to 2.5% on annual basis. However, early indications from states that have already published their results point to a possibility of a higher print as Saxony and Hesse regions reported CPI at three year highs. The cost of energy and food is blamed in these regions for the increase. Overall German inflation is due later today.

UK CBI reported sales in October printed -11% from -15% in September. The trend points to a further weakness but the GBP benefited slightly as the result was above expectations of -15%.

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The eagerly awaited Q3 GDP data is due at 8:30 am ET. The American economy is expected to grow 2.4% from previous 1.3%. In case of a significant disappointment, the existing market optimism could be reversed and risk aversion could come back.

Jobless claims that are due at the same time are seen at 400K from previous 403K.

Pending home sales due at 10:00 am ET are anticipated higher at 0.2% in September from -1.2% in August.

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