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

UK 100 Index called to open +40pts 7075, extending an overnight bounce from 7025 to break above 6-day shallow falling highs at 7050. Bulls need a break above 7100 highs before being able to challenge October flailing highs at 7140. Bears require a break back below 7050. Watch levels: Bullish 7100, Bearish 7050

Calls for a positive open come after a strong overnight bounce on Wall St. Markets in Asia shrugged off President Trump’s latest trade sabre-rattling with China, although some US Tech names slid after-hours after suggestions of a 10% tariff on Apple products imported from China.

Much of the UK Index positivity comes from comments by Chinese Foreign Ministry spokesman commenting that Presidents Trump and Xi agreed to reach mutually beneficial agreements ahead of their G20 meeting in Argentina. A boost for USD is adding to fresh pressure this morning on GBP.

GBP is weaker vs USD and EUR as concerns grow over PM May’s ability to pass her Brexit agreement through Parliament, and thanks to President Trump’s off-hand comments that the EU/UK deal was better for the EU and could prevent the UK from striking a US trade deal of its own.

In corporate news today, Reuters reports that, in October, Venezuela rejected BP’s plan to buy rival Total’s 49% stake in a gas project on the Trinidad & Tobago border. Bloomberg reports Standard Chartered eyeing simpler structure, to reduce costs (funding and overheads) and free up liquidity, according to “sources”.

BHP identifies potential new iron oxide, copper and gold system near Olympic Dam operations in South Australia, planning further drilling program for early 2019. Faroe Petroleum says DNO's 152p/share hostile takeover offer is opportunistic, substantially undervalues company (1% premium to 3-month volume weighted average price) and encourages shareholders to take no action.

Sky News reports RELX considering a £100m bid for Times Higher Education. CRH enters into non-discretionary instructions to conduct €100m phase 3 portion of €1bn buyback.

Intertek 10-month organic constant FX revenue +3.8% (Products +5.9%, Trade +1.5%, Resources +0.1%). Alchemy acquisition integrating well (est. c. £11m 2018 revenue contribution). On-track for FY targets with moderate margin improvement.

Pennon H1 underlying revenues and adj. EBITDA +3.1%, pre-tax profit +8.7% (statutory +2.9%), interim dividend +7.3%; on-track for full year expectations. Thomas Cook warns on profits; FY18 underlying EBIT of £250m, -18.8%, Revenues £9.58B, +6% like-for-like; suspends dividend; Expects 2019 underlying EBIT progress.

Greggs 9-week like-for-like sales +9% (managed shops +4.5%), ahead of expectations. Sees FY pre-exceptional pre-tax profit >£86m, higher than prev. guidance of similar to 2017 (£71.9m). UDG Healthcare FY revenue at constant FX +5%, pre-tax profit +15%, dividend +20%, net debt +14%. Expects further 2019 growth (organic & M&A), though Ashfield Commercial & Clinical could see some short-term ongoing softness. Rathbone Bros CEO to retire in May.

Cranswick H1 revenues +0.6%, adj. Operating profit +0.7% (statutory -4.3%), in-line despite uncertain domestic conditions and soft pricing in key export markets,  dividend +5.3%. Shaftesbury FY net income +6.2%, profit after tax -41.8%, EPRA +14.4%, EPRA NAV +4.1%, final div +4.9%, uncertain outlook from Brexit and retail, but London and West End insulated and good LT prospects.

In focus today will be the continuing political deliberations over the Brexit agreement. With the promised “meaningful vote” scheduled for 11 Dec, PM Theresa May has exactly 2 weeks to convince her reluctant Tory/DUP allies and the hostile Labour opposition MPs to accept her Brexit solution.

Macro-wise, today looks to be fairly uneventful, with only US House Prices (2pm), where growth is expected to have eased in September, and UK’s CBI Distributive Trades (11am), where markets expect a pickup in activity, of any interest to investors.

Scheduled speakers include the Bank of England Governor Carney (1:45pm), taking part in an online Q&A on the future of money, Fed’s Vice-Chair Clarida (1:30pm), speaking on data dependence and US monetary policy, and ECB’s Mersch (4pm), appearing in Frankfurt.

In the evening, Fed members Bostic, George and Evans (7:30pm) participate in a conference panel on financial innovation, the economy, regulation and the future of payments.

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