We'll get some clues next week about whether the slowdown will last.
The CBI's quarterly survey will be important in this regard. It could show a bounceback in business optimism after the Brexit shock, and also a pick-up in export orders thanks to sterling's fall. But investment intentions might still be weak, albeit perhaps not as much so as in July, and firms will express concern about rising input costs.
Other evidence might show that consumer spending is holding up. GfK could report a rise in consumer confidence - although this might remain below last winter's levels - and the Bank of England might report a pick-up in consumer credit. Also, if the CBI's survey confirms last month's expectations, it will report a small rise in sales in October. However, retailers might also say that this might not persist, due to sterling's fall raising import prices.
In the eurozone, meanwhile, we could get mixed signals. Flash purchasing managers' surveys might show manufacturing activity rising at its fastest rate since December; Germany's Ifo survey could show strong growth in the country; and the ECB could report a pick-up in bank lending. However, purchasing managers might also report weak growth in services, while the National Bank of Belgium might report only flat business confidence.
However, we might get good news about the US economy. Provisional estimates could show an acceleration in GDP growth to over 2.5 per cent (at an annualised rate) in the third quarter after only 1.4 per cent growth in the second quarter. And a pick-up in both durable goods orders and consumer confidence might point to decent growth continuing into the fourth quarter.
The downside of this strength, however, is that it might reinforce expectations that the Fed will raise interest rates in December. Ordinarily, the net effect of stronger growth and higher interest rates is positive for equities. But there can be big wobbles along the path.
