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

UK 100 Index called to open +10pts at 7130, having extended its bounce from 2017 lows of 7090 to reinforce long-term support and clear yesterday’s resistance hurdle of 7125. Rising lows support since the US close bode well for a challenge on Wednesday’s 7150 highs that could open the door for a rally back to 7250. Bulls are looking for a break above overnight highs of 7133.5; Bears want to see overnight rising lows support give way at 7125. Watch levels: Bullish 7135, Bearish 7120.

Calls for a positive open come courtesy of a strong finish on Wall St that gathered momentum overnight. A move by Trump to challenge steel imports and positive tax reform rhetoric from Treasury secretary Mnuchin revived hopes for the fabled Trump ‘reflation trade’, while oil holding firm and rebounds for Copper and Iron Ore have helped boost sentiment towards the commodity sector. Markets have also taken in their stride another terror attack in the French capital just days before Sunday’s first round of the Presidential election.

Japan’s Nikkei outperforms thanks to the Yen returning towards yesterday’s lows versus the USD after dovish comments from BoJ Governor Kuroda (keep accommodative policy) and the Trump and Mnuchin comments kept the Dollar bid. Australia’s ASX is positive, albeit less so, as oil finds stability to buoy Energy and Mining and Iron Ore and Copper rebound. Chinese shares, however, look headed for their worst week of the year on increased regulatory scrutiny and a crackdown on leveraged trading..

US equity markets closed sharply higher as the Trump administration signalled it was looking into possible tariffs on steel imports, Treasury Secretary Mnuchin suggested major tax reform was close and Q1 earnings remained in focus. The Tech-focused Nasdaq was the biggest beneficiary of the economic chatter yesterday, closing 0.9% stronger, while American Express closed up 6% after strong Q1 results, helping the Dow Jones to climb over 170pts, and a range of other corporate results lifted the S&P 0.8% higher.

Crude Oil prices are virtually unchanged overnight despite the Trump tariff-inspired jump in the wider commodities space. Both Brent and US crude remain in tight ranges following Wednesday’s sell off in reaction to rising US production levels (Brent $52.90-$53.20; US $50.50-$50.90), putting even greater impetus on this evening’s Baker Hughes Rig Count. Will the US production metric post its 14th consecutive weekly increase?

Gold has traded sideways overnight as the French terror attack failed to entice safe haven demand, while a stronger US dollar on account of the Trump administration’s protectionist measures and tax reform kept a ceiling of $1284 on the precious metal. Further US dollar strength would likely see the yellow metal test $1277 support, while further reflation trade doubts could see a test of aforementioned resistance for a return to 5-month highs.

In focus today will be the build up to this weekend's first round of the French Presidential election and all the potential outcomes, especially in light of last night’s Parisian shooting and its impact on undecided voters.

A Macron (centrist) & Fillon (centre-right) win would likely be the most palatable for financial markets. A Le Pen (far right) & Mélenchon (far left) result would surely raise alarms. Markets look to be pricing in something between the two with Macron & Le Pen progressing to the second round in a fortnight’s time, although the last year of global political events has taught us to expect the unexpected.

Data-wise, Eurozone and US PMI Manufacturing and Services are expected largely flat for their preliminary April readings while UK Retail Sales may show a 3-month rebound coming to an end, falling back into contraction following last month’s upside surprise. US Existing Home Sales are expected to show recovery after last month’s drop.

Speakers include ECB President Draghi and colleague Cœuré, participating in the 2017 Spring Meetings of the World Bank Group and the International Monetary Fund in Washington. The Bank of England’s Saunders (12.45pm) talks to the UK Federation of Small Businesses (FSB) while the Fed’s Kashkari (2.30pm) takes part in a Q&A on “the state of the economy, the role local community developers play in our financial health, and what lies ahead for community development corporations”.

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)

• Oil edges up but still set for biggest weekly drop in a month
• Restaurant Group finance chief leaves after less than a year
• UK's Sports Direct enters U.S. with Bob's Stores/Mountain Sports deal
• Hammerson signs £360m revolving credit facility
• Ithaca Energy says tender conditions for Delek takeover offer satisfied
• Australia shares rise on miners, but head for weekly loss
• Gold steady as investors cautious ahead of French polls