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

UK 100 Index called to open +5pts at 6305, having rallied strongly yesterday to break above the 6300 highs of early September to test just shy of 6350 overnight. This maintains the rebound from 5870 lows at end-September and breaks us out from a 5-week sideways shift. The bulls will be watching whether we can hold above 6300 and the level prove supportive, meaning potential for a push on towards June falling highs at 6600. Updated watch levels: Bullish 6360, Bearish 6290.

The positive opening call comes after a strong finish for stateside bourses (Dow Jones +300pts boosted by energy and oil) was followed by further gains in Asia overnight (best 5-day gain in 4 years) which sees them continue to rebound from a turbulent third quarter as markets factor in loose global monetary policy for longer based on weak economic data.

Asian stocks higher, tracking US equities and boosted by news of a Trans Pacific Partnership (TPP) trade deal between US, Japan, and 10 other Pacific Rim nations which has helped sentiment towards economic growth and the prospect of improved business relations.

Overnight, the RBA held interest rates at 2.0% for the fifth month in a row, with a weaker AUD providing a cushion against lower commodity prices and a poor outlook for major trading partner China. The Indian PMI Services fell but remained in growth territory adding to the decline in manufacturing last week. As we write, German Factory Orders collapsed in August, although holidays may have played a part.

While Goldman Sachs sees a chance that the US Fed holds off from a rate rise until well into 2016 due to slowing output and employment, the BoJ is also weighing up its options on further policy easing ahead of meeting tomorrow, under rising pressure to act against weak data. Hopes of easy policy and further stimulus continue to be fueled.

Regarding Greece, Eurogroup Chief Dijsselbloem said the Eurogroup agreed on the first set of milestones needing to be implemented by mid-October to unlock first sub-tranche of €2bn as part of recent bailout. Note, however, Greek bank recapitalization and debt talks require first assessment of Greek reforms to be signed off.

On the corporate front, note talk of SABMiller (SAB) fighting any expected bid by AB Inbev (BUD), while the latter is said to have ruled out any hostile approach. Oil major BP (BP) is also set to pay out $20bn to resolve all US oil spill claims.

In focus we have mostly speakers dominating the agenda today with the EU’s Juncker and Visco in the morning and ECB President Draghi in the evening. From the Fed we have George and Williams. Data-wise we have the US trade balance and IBD/TIPP Economic Optimism in the afternoon.

Oil price ticked back from the top of its recent sideways range, buoyed by comments from Saudi Arabia's oil minister who told India's Economic Times a drop in oil prices over the last year will prompt demand for OPEC crude and boost the cartel's market share as well as the Syrian conflict. 

Note Gold at its highest in nearly a week, trying to get back above $1140 to complete a bullish flag pattern even if risk appetite is healthy and the USD steady.

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

• Halma buys Firetrace USA for $110.0m
• UK Mail says H1 performance in line with its revised expectations
• Sirius Minerals updates on approval process for York Potash Project
• British baker Greggs sees better – than – expected full – year outcome
• Ferrexpo appoints PJT Partners to advise on ongoing debt negotiations
• SABMiller, in offer period, says Q2 volumes +2%
• Easyjet passenger numbers rise 7.6% in September
• Playtech to challenge Irish central bank decision on Ava Trade deal
• Melrose to return between £2-2.5bn capital to shareholders