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

UK 100 Index called to open +5pts at 7480 having regained poise overnight, recovering some 20pts from the lows of yesterday's 80pt sell-off. Bulls are looking for a break above 7485 overnight highs to allow for a recovery back above 7500; Bears want to see rising support at 7470 give way to trigger another down 80pt down leg. Watch levels: Bullish 7485, Bearish 7470.

A mildly positive opening call comes after a positive US close and despite a mixed Asian session as Oil prices rallied off their US inventory rise inspired lows. Helping sentiment, despite a trio of risk events, is a jump in Copper prices as heavy rain in Chile and China trade data defied expectations with an acceleration in exports (and imports) suggesting the economy holding up well.

Japan’s Nikkei underperforms after Q1 GDP was unexpectedly revised down, yesterday’s oil price losses weighed on Energy, and despite some Yen weakness. Down under, Australia's ASX was dragged lower by heavyweight Energy’s reaction to Crude price weakness and despite positive China trade data supporting sentiment towards metals prices.

US equity markets closed higher as markets hoped that today’s key testimony by ex-FBI head Comey may be less damaging than first expected. After Comey’s statement was released in full, major bourses rallied to trade close to session highs. Sectors heavily influenced by the ‘Trump trade’ (Healthcare, Banks) helped the Dow Jones rally 0.2%, outpacing the S&P500 (+0.1%), however the tech-focused Nasdaq outperformed, up 0.4%

Crude Oil prices have halted yesterday's sell-off following a surprise build in US EIA crude oil inventories on a potential 2.5m barrel import/export adjustment. Brent and US benchmarks have found support at $48 and $45.75 respectively having traded 1-month lows upon the completion of two head and shoulders bearish top patterns. Bulls will be hoping for an extended bounce to test support-turned-resistance at $49/$47, while bears will be hoping fresh oversupply uncertainty sees the recovery falter for a return to 2017 lows of $47/$44.

Gold has found shallow rising support at $1284 after retreating from fresh 2-month highs on its safe-haven/weak-dollar induced break out. However, former support at $1298 has turned into resistance as the overnight recovery falters, leaving the precious metal in a tight range before the European open. Major political and macroeconomic events today will have a significant influence on the safe-haven asset.

In focus today will be three well-documented headline risk events - the UK general election, ECB policy update and ex-FBI chief Comey’s Senate testimony.

The UK election race has tightened since PM May called the snap election on 18 April. However, it is likely too little, too late for Corbyn’s Labour, with May’s Conservative party widely expected to remain in power, and with a bigger majority. The 10pm exit poll was accurate in both 2010 (hung parliament) and 2015 (surprise Tory victory) so could offer a good indication of Friday’s final result.

The market focus on the latest ECB update (12:30pm) will be on any change to the press statement (near identical for several months) and hints about discussions to end ultra-loose policy (reducing QE; raising rates). President Draghi is likely to be pushed on this (1:30pm press conference), potentially resulting in another uncomfortable outing. Watch for inflation expectations being trimmed, still below target and at odds with improving growth, thus hindering policy normalisation.

Finally, ex-FBI Director Comey’s testimony to the US Senate intelligence committee (3pm) will thrust the Trump administration’s relationship with Russia back into the spotlight. The opening statement was released overnight, meaning the real entertainment may lie in the subsequent Q&A and whether Comey plays the ‘no comment’ card or delves into further detail.

Macro data will take a back seat day. The third and final estimate for Eurozone Q1 GDP is expected to be confirmed at 0.5% QoQ and 1.7% YoY. The latest US Weekly Jobless Claims are forecast to have held around 240K (initial) and 1.92m (continuing).

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

• Assura says to pay next dividend of 0.60p on July 19
• Flybe reports pretax loss of £19.9m vs. £2.7m profit previous
• Hunting concludes a competitive tender for statutory audit services
• Auto Trader FY revenue rises
• Pound clings near 2 – week high on UK election day; euro awaits ECB
• Rockhopper disposes non – core interests onshore Italy to Northern Petroleum
• Boohoo says raised £50m via placing
• UK's CMC Markets reports lower FY profit amidst quieter markets
• Petrofac gets long – term framework deal with Petroleum Development Oman
• London copper rises to one – week high as China trade gains
• Gold inches down ahead of UK polls, ex – FBI chief's testimony
• Oil rises off one – month lows struck after surprise stock build