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

UK 100 called to open +5pts at 6735, amid its post-Brexit uptrend, with an overnight test of 6750 keeping Bulls optimistic about the potential for 7122 all-time highs to be revisited. Rising lows support remains valid at 6700, the floor of a 2-month rising channel that began mid-May and resumed early July after a Brexit-inspired interruption. Said channel would need to be breached to the downside to inspire Bears about the chances of a reversal. Watch levels: Bullish 6745, Bearish 6715.

A positive opening call comes after a lacklustre session in Asia to start the trading week, with conviction lacking as investors gear up for another week of event-risk. The Fed and BoJ deliver updates on Weds & Friday, respectively, the former potentially offering clues about rate-rise timing, the latter is expected to explain its next move in terms of monetary stimulus.  This while the fallout from the UK's referendum dominated the week's G20's meeting of finance ministers

Reporting season accelerates on both sides of the Atlantic, this week with a long list of major blue-chips set to update markets on their latest quarterly performance and, more importantly, their outlook since the UK’s Brexit vote. Note stateside earnings helping keep US bourses around all-time highs with a positive read across globally. The situation regarding Italian Banks and bad loans, however, remains tenuous, given the potential contagion risk in Europe as investors weigh up rescue plans.

Japan’s Nikkei is just in the red failing to derive benefit from less bad import/export growth data and a weaker Yen ahead of expected BoJ stimulus. Note Australia’s ASX outperforming in spite of oil prices under continued pressure, hurting the Energy space, with buoyant metals prices providing some support. China stocks are flat.

US markets closed out the week in positive territory, with stock indices flirting with record highs once more while safe haven treasuries stayed mixed ahead of this week’s FOMC meeting. Investors are keeping one eye on the bond market just in case we get a more hawkish message from the Fed as US  data continues to impress (most recently the manufacturing PMI beating expectations in July).

A late recovery in the oil price on Friday leaves Brent and WTI in a new narrow range this morning - though both markers are near 21 Jul falling highs resistance. Note also the Baker Hughes rig count posting a sharp increase of 14 operational rigs last week while markets remain concerned by a continued glut of gasoline and other refined products.

Gold is close to another test of support at $1312 as it continues to sell off from its early July highs. Additional downwards pressure could be forthcoming this week if the Fed meeting produces any hawkish rhetoric, which would move the USD.

Today’s focus will be German IFO Survey data for July, potentially showing the sentiment impact of the UK’s Brexit vote. Likewise, the UK’s CBI Trends report could hint at the effects before the US Dallas Fed this afternoon which is seen holding negative, albeit off its worst levels.

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

• Toscafund says requested general meeting of Speedy Hire shareholders
• William Hill says not clear Rank and 888 deal would enhance position
• Hammerson says UK property market facing uncertainty after Brexit vote
• XP Power says H1 adjusted profit before tax up about 4 pct
• HSBC says in talks to sell Lebanese business to Lebanon's Blom Bank
• Oil prices dip on ongoing oversupply, economic headwinds
• Hiscox considers setting up new EU arm to weather Brexit
• Anglo American sees H1 underlying earnings of $68 mln from Amplats
• Cranswick Q1 revenue up 11 pct, sells Sandwich Factory to Greencore
• Hiscox says H1 pretax profit before currency 118.7 mln stg
• Aberdeen Asset Management says Q2 assets up on market, currency gains
• Ryanair says it's still on track for record profit despite Brexit hit
• London copper edges up, prospect of more supply caps gains
• BT willing to give greater autonomy to Openreach unit – chairman
• Randgold Resources: Tongon Difficulties Will Have Negative Effect On Production