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

UK 100 called to open +30pts at 5980, with yesterday's late bounce from 5900 resulting in a strong rally back to 6015 overnight. However, failure to get back above Monday’s lows and deliver a breakout, and after falling back below 6000 this morning, suggests we may simply retrace to the lows, officially putting the index in a 5900-6000 sideways channel. And still in a June downtrend. The bulls will be looking to overcome 6000 to get out of the channel. The Bears want another pullback to 5900 support. Watch levels: Bullish 6025, Bearish 5970.

A positive European open follows gains in both the US and Asia that can be attributed to diminished fears of a UK exit from the European Union (Brexit). This after campaigning was suspended by both sides following the callous murder of mother, humanitarian, MP and ‘Stronger in Europe’ campaigner Jo Cox. The assumption is that the tragic event will sway the undecided to vote Remain and possibly even reverse some of the Leave momentum seen in recent polls.

Asian stocks are rebounding from 3-week lows with Japan's Nikkei benefiting from a strong Yen coming off its highs and Oil snapped a 6-day streak of losses to give the Energy space a boost. A slightly weaker USD is giving the commodities space a lift, thanks to UK Sterling (GBP) rallying from its lows on reduced Brexit fears, with a positive knock-on for Australia's ASX index. Markets also still digesting that more bearish Fed outlook.

Note Gold losing its shine, back below $1300  despite a weaker USD, after the odds of a Brexit vote fell. This has reduced market fears about the political, economic and market knock-on from a 'Leave' outcome after what had become an increasingly acrimonious referendum debate.

In focus today will undoubtedly be the fallout from yesterday’s tragic and senseless murder of young UK Member of Parliament and ‘Britain stronger in Europe’ campaigner Jo Cox which has shocked the nation and lead to the understandable suspension of referendum campaigning by both sides.

Elsewhere, amid a conspicuously light macro line-up, will be Eurozone Labour Costs at 10am. This is for their potential read across to inflationary pressures within the region and ability to help usher it out of a deflationary quagmire. Can gains of 1.3% in Q4 be repeated? Speaker today include the IMF’s Lagarde, the ECB’s Coeure and ECB President Draghi.

Thereafter, data is limited to US Housing Starts and Permits, with the data offering hints about consumer confidence in US economic recovery. While Starts may be forecast -1.9% in May, it does come on the back of a strong +6.6% in April. And Permits are still seen delivering positive growth of 1.3%, albeit at a slower pace than April’s 4.9%.

As usual the week closes with the latest US Baker Hughes Rig Count which may show a continued bottoming out and turnaround as land-based stateside operators are attracted back to the game by higher oil prices ($50). Prices still not enough to encourage more of the expensive offshore activity. Although watch the 10% falls in oil prices and bucking of the uptrend unravelling the recovery.

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

• Wood Group Buys EESL's Aberdeen Fabrication, Manufacturing Business
• Tesco to Sell Dobbies Garden Centres for £217m
• Brexit Would Put EU Drug Regulator's Headquarters in Play
• HSBC to Pay $1.58 Billion to Settle Shareholder Suit -- Update
• BHP May Spend Up to $2B on Anglo American Coal Mines
• Credit Suisse Sees Sense in Exxon, BHP Oil Asset Sale