Markets Overview: (Source: Bloomberg, FT, Reuters, DJ Newswires)

 UK 100 called to open -3pts at 6767, with the recovery from Thursday’s lows 6785 losing steam on Friday. Mid-Dec uptrend remains and the index is back in a sideways trading channel from Feb 10 with weak resistance to the upside around 6976. We may be witnessing a pause before the weekend with potential for further recovery into next week. Bulls looking for a break above 6870 while the bears will eye a fall-off to support at 6700.

The negative open follows a mixed Thursday session for European equity markets with disappointing German retail sales spooking investors looking to Europe’s #1 economy for inspiration. Greece in focus again as sentiment swung once more with the ECB increasing the limit for Greek banks’ ELA by €600m. BoE governor Carney talked about interest rates, following cues from the US Fed, and concentrated on the factors that could affect a rate rise – foreign price evolution, the Sterling’s strength and domestic cost pressures, all of which would appear relevant in the current economic climate.

US bourses finished in positive territory after weaker US retail sales report which has some investors questioning whether the FOMC will signal imminent rate hikes next week. Meanwhile, the US budget deficit narrowed in February.

Asian markets tracked Wall St’s lead and finished the session mostly higher as the Nikkei surpassed 19000 – another 15-year high. BoJ Governor Kuroda said wage growth is needed for sustainable inflation and expects consumer prices to rise due to wage hikes and rising inflation forecasts. Japanese PM Abe said the yen’s strength has advantages and disadvantages, whether weak or strong, which was sufficiently vague to keep investors in the game.

In focus today will be UK construction output, a key interest rate decision in Russia, US consumer sentiment and the Baker Hughes Rig Count.

Oil was up this morning as WTI made it above the $47 to put it in the upper half of a neat 8-day downwards channel as we await the Baker Hughes rig count later today, with the usual expectations. Brent prices are flat-ish this morning but with potential for a recovery from March lows supported by tension in the Middle East, as the Iraqi military clashed with the Islamic State in Tikrit amid the strongest operation against the Islamists since the conflict began.

Gold ($1159) is trading sideways since 10 March, again not much action as we move into the weekend. Lack of safe haven demand as Greece continues to get assistance it needs from the ECB but the intensifying fight against ISIL is likely to be propping up prices somewhat.

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Key Overnight Macro Data: (Source: Reuters/DJ Newswires)

• Japan                    Industrial Production                      Deteriorated

See Live Macro Calendar for full data line-up, incl. consensus expectations

UK Company Headlines: (Source: Reuters/DJ Newswires)

• Afren signs agreement for interim funding
• StatPro releases new market values based data model in latest release
• Wetherspoon targets sales boost with breakfast, coffee push
• Oxford Biomedica FY revenue excluding grants 13.6 mln stg vs 5.4 mln stg
• VPC Specialty Lending Investments raises 200 mln stg in IPO
•  Revolution Bars London IPO priced at 200 p/shr
• Sthree Q1 gross profit on constant currency basis up 17 pct
• John Wood awarded 41 mln stg Statoil engineering contract
• Dart Group sees FY underlying operating profit ahead of market expectations