Market news today - busy week for nervous investors

This week in the markets, the dominant market drivers are jostling for pole position this week as inflation, interest rates and earnings all have their moment in the spotlight.

Top of the agenda here in the UK will be Wednesday's budget.

It's a very different event from the last two fiscal statements, which were heavily leaked and characterised by frenzied speculation about possible tax rises.

This time around, the new chancellor, John Healey, has managed to keep an unusually tight lid on pre-budget gossip.

A few measures appear to have been ruled out, such as changes to the pensions tax free allowance, CGT and a broadening of the yet to be implemented mansion tax.

But we are in the dark about what he will and won't unveil on Wednesday.

This means the bond market reaction will be important during and immediately after the Chancellor's speech.

With long bond yields in the UK approaching 6%, the most important job for Healey is to convince investors that he will do no harm to a UK economy, which on a range of measures appears to be doing rather better than the general mood of gloom and doom might suggest.

Although inflation came in last week slightly above expectations at 3.5%, growth is thought to be pretty strong at nearly 2%, suggesting that the Chancellor may feel that a reduction in the so-called fiscal buffer is justified by improving economic prospects.

And with luck, the bond vigilantes will agree.

As well as bond yields, the key indicators to watch will be sterling and the relative performance of UK-exposed shares such as the banks, which face a possible increase in their profit surcharge.

This is one of the few measures not to have been ruled out and looks likely.