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

UK 100 Index called to open -55pts at 7575, after an overnight breach of May’s 7593 lows to push the index from its recent 7590-7800 range. The breakdown extends Thursday’s reversal from 7800. The index is off its overnight lows (7545) but remains under pressure. Bulls likely need a break back above 7600; Bears require a breach of 7545. Watch levels: Bullish 7595, Bearish 7550.

Calls for a lower stem from President Trump threatening China with a fresh $200bn in trade tariffs. This after China retaliated in kind, defending itself from the $50bn import duties imposed by the US last week. Global sentiment is on the back foot amid signs that neither side will back down, potentially taking global commerce a step closer to an unwelcome trade war.

Oil prices are lower as we inch towards Friday‘s OPEC meeting which could well see the cartel (read Saudi Arabia) and Russia announce their intent to begin rolling back on the coordinated production cuts that have helped oil prices recover. Gold prices higher in Asia overnight, along with other safehavens like the Japanese Yen, fuelled by heightened trade war concerns and helped by a weaker USD.

In corporate news this morning, Ashtead Q4 rental revenue +21%, EBITDA +14%, pre-tax profit +10%, final dividend flat, full year dividend +20%; all divisions performing well; end markets strong; expects similar CAPEX this year; looks to medium term with confidence.

In bad news for the high street, Debenhams sees FY 2018 pre-tax profit missing forecasts by 20-30%; May/June trading “off target”, hurt by competitor discounting weakness in key markets.

Ferguson Q3 revenues +10.2% (+7.1% organic), trading profit +17.1%, net debt -82% after Stark sale; Q4 started well, organic growth in-line with Q3. DS Smith plans £1bn rights issue to fund Cartones de Europa purchase; 293.1m new shares at 350p; 31% discount to yesterday’s close.

Capita reached agreement to sell Supplier Assessment Services for £160m cash, proceeds to cut debt; accounts for half off 2018 £300m targeted non-core disposals. Telecom Plus full year revenues +7.1%, adj. pre-tax profit (continuing operations) +1.8%, full year dividend +4.2%; upward pressure on energy prices; comfortable with profits guidance.

Countryside Properties expands partnership with Sigma Capital to target delivery of 5,000 private rental homes over 3yrs. McCarthy & Stone highlights noticeable decline in reservation rates since mid-April, cuts guidance, CEO to retire, update on strategic review in September.

In focus today - another quiet one for data - will be US Building Permits & Housing Starts (3pm), a useful gauge for US consumer confidence and economic stability. The print comes hot on the heels of a disappointing NAHB print yesterday blamed on soaring lumber costs.

With oil prices very much in focus ahead of Friday’s biannual OPEC meeting (production cuts to be extended or rolled back?), in the meantime the latest US API inventories (9.30pm) update could influence sentiment in terms of demand for fuel types and thus economic growth.

The ECB Central Bank Forum kicks off in Sintra, Portugal with ECB President Mario Draghi delivering an Introductory speech (9am), before Chief Economist Praet chairs “Macroeconomics of price and wage-setting (9.30am & 12pm) alongside the Fed’s Bullard. Elsewhere the ECB’s Nouy reads an introductory statement at the ECON Hearing at the European Parliament in Brussels.

US companies reporting results include newly spun-off and IPOd AXA Equitable (Q1), global trade barometer Fedex (Q4), financial services group Jefferies (Q2) and software giant Oracle (Q4).

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.