President Donald Trump and corporate America may not be satisfied with the revised Senate Republican tax plan. The dollar and global equities received a hit on news that Republican senators are likely to delay the introduction of corporate tax cuts until 2019. The reaction in markets wasn’t a surprise given that investors have been pricing in a lot of good news and further pullback may continue for a couple of days or weeks, as many stocks look overbought at the moment.

The Senate wants to maintain the seven tax brackets, rather than the four proposed by the house. They also want to tax foreign profits held by offshore U.S. companies at a different rate. However, the timing of the corporate tax cuts will likely determine how markets move for the remainder of 2017.

The dollar traded in very tight ranges early Friday after falling on Thursday. While the delay in tax cuts isn’t good news for the U.S. currency, the rise in U.S. Treasury yields prevented the dollar from falling further. The U.S. economic calendar is light today with only November’s Michigan Consumer Sentiment Index due for release, so I don’t expect much action unless the Senate reveals a detailed tax reform plan.

Sterling is the only currency in play. with manufacturing and industrial production, trade balance, and NIESR GDP estimates, due for release later today. Brexit negotiations also resumed on Thursday, but according to officials there was no major breakthroughs. If talks in Brussels end in a similar way to previous negotiations, expect Sterling gains to remain capped.

Oil prices were also moving in narrow ranges after rallying sharply at the beginning of the week. High demand, falling inventories, and confidence that OPEC will extend production cuts, will likely keep the prices elevated in the short run, but the geopolitical risk premium due to tensions in the Middle East, has undoubtedly been responsible for a large portion of the recent surge in prices. I still believe that current fundamentals aren’t sufficient to keep Brent above $60-$62, however geopolitical tensions will continue to be the main driver in the days and weeks to come.