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

UK 100 Index called to open -20pts at 7365 in a downtrend since another failed attempt to conquer 7390 late yesterday. A breach of yesterday’s 7370-75 support, which has since served as resistance, may concern Bulls, however, 7360 represents major support in the form of January highs. Bulls will be looking for a bounce and break back above 7370 while Bears look for 7360 to give way. Watch levels: Bullish 7370, Bearish 7360.

Calls for a negative European open derive from Asian bourses and US futures losing ground after Wall St extended a pullback from Wednesday’s record highs (peaked?). More political scandal, a lack of policy clarity and perhaps realisation about another US rate hike are offsetting all that optimism from Trump’s congressional address. Even a very positive reception to Snap’s IPO has failed to rekindle bullishness, sentiment perhaps weighed on by disappointing Chinese and Japanese PMI Services overnight.

Japan’s Nikkei is in the red despite the Yen coming back off its highs, sentiment ignoring any excitement surrounding Nintendo’s latest product launch (Switch), much like the lack of help from Snap in the US yesterday. Australia’s ASX underperforms, hampered by weakness among Miners as a lower China PMI Services and USD strength weigh, and lower oil prices hurt Energy focused names.

Despite markets factoring in an even higher probability of a US rate hike, the USD has eased from yesterday’s peak. Unfortunately for the UK UK Index and German DAX, however, GBP and EUR resilience are serving to hinder the indices. After weakness down  under, keep an eye on both Miners and Energy on the UK Index .

UK Index sentiment may also be impacted by WPP (dividend hike, targets 2% 2017 revenue growth), AstraZeneca (to develop and commercialise MEDI8897 for Lower Respiratory Tract Illness jointly with Sanofi); LSE (dividend hike, continues to work on Deutsche Boerse merger; see growth opportunities across all markets).

US equity markets pulled back from record highs despite a well-received Snap IPO yesterday as investors took stock of holdings and engaged in some profit taking. Caterpillar was the laggard for the Dow Jones as its offices were investigated by law officials, while Financial stocks weighed on the S&P 500, however crucially its 0.6% decline did not break the index’s 90-day run of sessions without a greater than 1% decline.

Crude Oil prices have found some support with both Brent and US benchmarks having fallen over 2% yesterday to 3 week lows. A welcome halt at $55 (Brent) and $52.50 (US) comes as the US dollar rally edges slightly lower, however this evening’s Baker Hughes Rig Count could reignite bearish sentiment should the US production proxy show yet another increase.

Gold encountered a double breakdown of support at $1240 yesterday, including its 2017 uptrend, with the dollar soaring as yet more Federal Reserve members threw their weight behind a March rate hike. Today sees key speeches from Fed Chair Janet Yellen and at least three other voting members, with any indication of a March rate hike from Yellen likely to add to the non-yielding safe haven’s woes.

In focus is this afternoon’s raft of Fed speakers, airing their views before the blackout period that precedes a 15 Mar policy update where markets are pricing in (86% probability) another interest rate rise. Comments from Evans, Lacker, Powell and Fischer may, however, be overshadowed by anything akin to a clear steer from Chair Yellen about an imminent hike. Or not.

Data wise, PMI Services readings will be the order of the day from 8am, with figures from Spain, Italy, France, Germany and headline Eurozone (9am) are all expected to confirm continued improvement for February while the UK (9.30am) and US (2.45pm) cool from December highs

Elsewhere, Eurozone Retail Sales (10am) growth is forecast to have rebounded in January and accelerating annually, this of particular interest in light of rising Eurozone inflation.

For any help you may require placing trades or in terms of market information, put a call in to our trading floor – it’s all part of the service.

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

• Paysafe appoints Tim Thurman as chief digital officer
• AstraZeneca ties up with Sanofi on respiratory drug
• LSE still trying to get Deutsche Boerse tie – up approved
• London Stock Exchange full – year profit rises
• WPP sees tougher 2017 after hitting 2016 net sales target
• London copper set for flat weekly close, U.S. rate hike prospect weighs
• Ryanair says February traffic grows 10%
• Oil ticks up on weaker dollar, stalled Russian output cuts
• Gold heading for worst week since Dec. on rate hike worries