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

UK 100 called to open -20pts at 7085, having breached October intersecting support at 7100 to test 7070 overnight. This opens the door for a pullback to the floor of the longer-term 6960-7340 post-Christmas rising channel. Bulls need a break above 7110 to overcome recent falling highs. Bears require a breach of 7065 falling lows support. Watch levels: Bullish 7110, Bearish 7065

Calls for a negative open come after mixed trading on Wall St turned even more negative in Asia after China’s Manufacturing PMI hit a 3-year low in Feb (49.2 vs. 49.5 est./prev.), continuing its 3rd month of factory output contraction and further emphasising concerns about Chinese and global economic growth. Trump-Kim summit in Hanoi ended abruptly without agreement or closing ceremony, adding to jittery sentiment.

USD is off Wednesday’s 3-week lows following comments from Fed Chair Powell that the Fed is close to announce plans to stop reductions of its $4tn balance sheet (quantitative tightening) began 1.5 years ago under previous Fed head Yellen.

In corporate news this morning; Housebuilders may not like Nationwide House Prices -0.1% in Feb (consensus flat, prev revised down to 0.2% from 0.3%) but they did improve annually (+0.4% YoY vs. +0.1% prev +0.5% est.). Miners may be sensitive to ratings agency cutting Brazil’s Vale to Junk.

IAG offers €0.35 special div and final ordinary div of €0.165 (+13.8%), doubling yield to 9%. 2018 passenger revs +6.2%, op profit +9.5%; Avg Seat KM +6.1%, passenger revs per ASK  +0.1%, non fuel costs per ASK -2.2%. At current fuel prices and FX rates, expects 2019 operating profit broadly in line with 2018. Passenger unit revenue and ex-fuel unit cost to improve at constant FX.

Mondi FY revenue +5% missed +6.7% est, underlying EBITDA +19% beat +17.5% est., underlying op. profit +28% missed +25.5% est. FY div +23%, but no special dividend. Confident in packaging growth, but pricing mixed and plans longer maintenance and project shutdowns in 2019.

CRH FY revenue +6% (+3% like-for-like), EBITDA +7%, group profit +31%, total dividend +6%. Future dividend growth to lag earnings. Expects continued growth in US construction and progress in Europe despite Brexit uncertainty.

Rolls Royce 2018 underlying financials ahead of expectations; Core cash flow more than doubled, taking net debt to net cash; Withdraws from NMA engine competition, unable to commit to timetable; restructuring on-track.Expects 2019 higher operating profits and free cash flow in 2019.

Rio Tinto reports a +3.4% growth in Pilbara mineral resources after higher iron ore finds at Music Hall, Old Vic and Western Hill sectors. Rentokil FY revenues +2.5% and adj. pre-tax profit +7.4% beat consensus (excl. pension settlement); cash flow strong, final div +15.2%; exceeded targets. Anticipate slight increase in consensus ests.

British American Tobacco FY revenue +25.2% (adj. +3.5%), op. profit +45.2% (adj. +4%), net op. cash +92.5%, dividend +4%. Competitor took vapour market share, but Vuse vol +36% (70% mkt share). Expects 2019 earnings up high single digits like-for-like. Confident managing menthol ban.

Aston Martin swings to 2018 pre-tax loss hit by IPO costs although adjusted profits rose; backs 2019 sales targets.

RSA Insurance FY net written premiums -3% (in-line), underwriting profit -36%, pre-tax profit +7.1% (missing +16.3% est.), underlying return on tangible equity +15.5%. Interim dividend +10.6%, final dividend +5.3%. Notes volatile market conditions, but 2019 results to be substantially improved.

In focus today: the Vietnam summit (no agreement, no statement), more disappointing China macro data (PMIs) and the UK’s opposition Labour party now backing a second Brexit referendum and a vote on extending A50 should a meaningful vote on the PM’s deal in March fail.

Macro data today includes German inflation (1pm), rebounding in February (0.5% MoM vs -0.8% prev) and accelerating annually (1.5% YoY va 1.4% prev), up off its lowest since last May.

Thereafter, quarterly US GDP (1.30pm) is forecast to have slowed further in Q4 (2.4% QoQ vs 3.4% prev), normalising from Q2’s peak (4.2%). The GDP inflation metric is seen higher (1.7% QoQ vs 1.5% prev), which could support USD, although PCE and Core PCE may have edged back.

Chicago PMI (2.45pm) could rebound from January’s lowest in almost 2 years and the Kansas Fed Manufacturing Index (4pm) will be looked to for signs of bottoming out from a protracted decline.

Speakers today include the Fed’s Clarida (1pm; ""Promoting Global Growth and Domestic Economic Security"), Bostic (1.50pm; "Economic and Housing Landscape"), Harker (5.15pm; “economic outlook”) and Kaplan (6pm; moderated Q&A at Real Estate Council of San Antonio)

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