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

UK 100 Index called to open +90pts at 7205, futures having gapped above 7200 last night as Asia started the new trading week. Even an overnight easing merely filled the gap to last Wednesday’s 7150 highs, instilling fresh support before rebounding. Bulls are excited at the prospect of challenging last week’s 7250 breakdown, however, a break above 7225 is required. Bears, however, point to 7250 likely proving a big hurdle by way of falling highs resistance since 12 Apr. Watch levels: Bullish 7225, Bearish 7190.

Calls for a positive open come as Asian markets and the Euro welcome news of Macron and Le Pen progressing to the second round run-off of the French presidential election. The assumption is that centrist Macron is victorious in a fortnight's time, picking up supporters of Fillon, Hamon and Mélenchon. Pollsters may have been right this time; how things swing in the next two weeks is anyone’s guess.

Fresh talk of Trump tax hopes appear to have been tempered and markets still wary that aims will be elaborated on rather than actual policy progress, markets getting increasingly impatient for the latter, while the man himself concentrates on relationships with China and what to do with North Korea to keep us on our geopolitical toes.

Japan’s Nikkei is outperforming thanks to a rampant Euro helping push the Yen lower (-2%) to the benefit of exporters. Australia’s ASX is positive, but only just, as lower oil prices hurt Energy and an a US Dollar finding its feet hinder the commodity space as a whole.

US equity markets closed lower on Friday as investors in the States positioned themselves ahead of the weekend’s French election. The Dow Jones closed 0.2% lower as Tech stocks bookended the index; Microsoft led all stocks while Verizon underperformed. Only two sectors (Utilities and Industrials) closed higher on the S&P500, while the Tech-focused Nasdaq was the top performing index, albeit closing 0.1% lower.

Crude Oil prices have begun to recover from 1-month lows overnight following on from a 14th consecutive weekly increase from the Baker Hughes Rig Count, with the amount of US rigs in operation now at a two year high. Both Brent and US benchmarks remain in downtrends from mid-April highs, with hurdles to be cleared at $52.70 and $50.50 respectively.

Gold has fallen sharply in the wake of favourable French election results and, despite mounting a recovery in early Asian trading from $1265 lows, has since fallen from $1277 support turned resistance back to around the $1270 mark. Investors will continue to digest the results from across the channel and potential risk-on mood for equities, while also eyeing any US dollar recovery to further add to bearish sentiment.

In focus today will be fallout from the French Presidential election first round result, investors assessing centrist Macron and far-right Le Pen’s second round chances. The first round was the closest in decades, with only 4 points between the top 4 candidates; will the second be just as tight or will Macron confirm the polls and pick up supporters of losers Fillon, Hamon and Mélenchon?

Data-wise, German IFO surveys (9am) are seen coming in virtually flat, while UK CBI Trends data may cool in April from 2-year highs in March. This afternoon, we digest a double helping of Fed economic indexes from the Chicago Fed (national activity; 1:30pm) and the Dallas Fed (manufacturing activity; 3:30pm), the former looking to build on a February rebound while the latter aims to accelerate again following March’s easing.

Speakers of note today include the UK PM Theresa May (2:30pm), continuing on the campaign trail ahead of the 8 June UK snap general election, while the Fed’s Kashkari (voter, dove) undertakes two Q&A sessions at Californian universities this evening (4:30pm and 8:15pm).

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

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• Anglo American reports 9% output rise, but copper down
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• Oil recovers lost ground, but market remains under pressure
• Gold falls as stocks gain after French election result