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

UK 100 called to open +45pts at 7120, extending a bounce from 7040 and a break above 7075 to clear this week’s trend of falling highs resistance. While not bouncing from the floor of a 2-month rising channel, potential is there for a rally back towards recent 7250 highs. Bulls need a break above 7140. Bears require a breach of 7100. Watch levels: Bullish 7140, Bearish 7100

Calls for a positive open come after upbeat sentiment sent Asian markets higher following better than expected Feb China Caixin Manufacturing PMI (49.9 vs. 48.5 est./48.3 prev.) retracing January’s decline, back just shy of breakeven. MSCI emerging markets index also said it will triple its weighting of Chinese equities to 3.3%, increasing the buyer pool.

In corporate news this morning; Royal Dutch Shell to be prosecuted by Dutch authorities for criminal charges over an oil prospecting license OPL245 dispute in Nigeria (settled in 2011).

Lloyds has started the £1.75bn buyback programme it announced 20 Feb. Rentokil plans to use est. £500m-1bn in unclaimed UK 100 dividends and shares to fund charitable causes.

WPP FY £15.6bn revenue (+0.8% like-for-like) beat £15.3bn est. (upper end of own guidance), like-for-like billings +3.2%, EBITDA -8.8%, pre-tax profit -30.6%. Reiterated guidance for a challenging H1’19 due to headwinds from 2018 client losses, like-for-like sales to fall 1.5-2%.

Rightmove 2018 revenues and underlying op profit +10%, final div +11%; stable membership; visits +4% (132m/month), visit time +5% (1bn mins/month); ARPA +9.2%; sees more growth despite Brexit, thanks to digital efficiencies; not materially impacted by property cycles, except if extreme.

William Hill FY adj. net revenue +2%, rev. from new US operations -£33.2m, swung to a £721.9m pre-tax loss (profit -16% on adj. basis) after £922m exceptional charges, incl. a £882.8m non-cash impairment in Retail after regulatory changes. Cut dividend -9%. 2019 guidance in-line with market.

Man Group FY funds under management -0.5%, net inflows -15.6%, $7.7bn negative investment movement (after positive $10.7bn prev.). Adj. pre-tax profit -34.6% after a performance fees -63% and increasing redemptions. Cut final dividend -2.8% (FY: +12.1%).

LSE says it will miss 2019 EBITDA margin target of 55% and 2017-19 compound annual operating expenses growth target of 4% due to investment costs; Reports 2018 total income +9% and adj op profit +15%, both beating consensus, and final div +17%.

IMI CEO steps down, replaced internally. 2018 evenues +9%, adj. operating profit +11%, pre-tax profit +12% (ahead of company expectations), operating cash flow +2%, dividend +3%, net debt +52%; Expect lower organic revenues in H1 2019, but margins similar; normal FY H2-weighted.

In focus today will be PMI Manufacturing (8-9am), Italy edging further into contraction and Spain retracing some of January’s bounce. While France should have stable growth in Feb, however, engine room Germany and the Eurozone as a whole may confirm more contraction, extending the 2018 downtrend.

The UK (9.30am) is forecast to post a lower read than Jan, retreating further from December’s Q4 rebound high. The US (2.45pm) may also confirm a Feb pullback from Jan’s rebound, ISM Manufacturing (3pm) potentially doing the same.

UK Mortgage Approvals and Lending (9.30am) are both expected lower in Jan, although net lending to individuals may jump. Eurozone Inflation (10am) is seen a touch better for Feb on a Headline basis, but flat for Core.

This afternoon, US Personal Income and Spending (1.30pm) may offer contrasting views, suggesting consumers saving/paying down debt, with income up but spending down in December. Inflation metrics may suggest slightly weaker price growth in December, bit Core inflation stable.

Speakers are limited to Fed’s Bostic (6:15pm, dovish, non-voter), speaking on economic outlook and monetary policy in Washington.

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