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

UK 100 Index called to open -90pts at 6685, back around late Friday’s 6680 sell-off lows. This after an overnight bounce above 6700 quickly reversed to maintain Friday’s trend of falling highs and leaves the index trading close to early August lows. Bulls are hoping this is an overreaction, the worst now priced in and that recovery ensues towards 6800. The Bears note 6720 early September lows as potential resistance, eyeing another leg down to revisit 6610 August lows before support kicks in. Updated watch levels: Bullish 6705, Bearish 6670

A negative open comes as markets price in a higher probability that the US Fed will hike rates again next month. This comes after Boston Fed Governor Rosengren (FOMC voter) reiterated a hawkish message on Friday that served as the nail in the coffin for market concerns regarding global monetary policy divergence. This sealed a week-end sell-off for equities. Add to this questions being asked of the health of US Democratic Presidential nominee Hillary Clinton and a new layer of political event risk sees markets on the back foot into the new week.

Asian equities are echoing Friday’s negative stateside finish with losses of 1.5% to 2% as investors reassess their appetite for risk and commodities sell-off from their highs due to a USD; oil $3 lower, Copper fresh September lows, peers such as Iron ore also in decline as growth uncertainty rises.

At market close on Friday, the Dow Jones posted its worst day of trading since June 24 amongst concerns over interest rate hikes (following Federal Reserve President Rosengren’s speech) and rising geopolitical tensions (most notably North Korean missile testing). After the announcement of a pneumonia diagnosis  for Democratic Presidential nominee Clinton culminating in the cancellation of a Californian campaign trip, expect further pessimistic trading from our counterparts across the Atlantic today.

Oil, having received a sharp price increase in price after surprise US stockpile declines on Thursday, has since reversed as analysts realise the one-off nature of the figures as US rig count increases for the second week running. Coupled with fresh scepticism as to whether an OPEC-led production freeze will take place with Saudi Arabia seemingly taking a back seat in informal talks, prices of US crude are testing the $45 per barrel mark this morning with the potential to fall even further on a weak London opening.

Gold continued a late week downtrend as ECB monetary policy failed to provide further measures to buoy investor sentiment, although finished slightly up for the week. Overnight a sideways trend took place before Monday’s final US Fed speeches before the September 20-21 policy meeting, likely having a significant impact on the volatile gold market later in the day.

All eyes will be on the US Fed today as the final speeches before the blackout period ahead of next week's policy meeting take place. In particular, the late scheduling of a speech by the usually dovish Fed governor Brainard has sparked interest from the markets, as a U-turn in tone to anything more hawkish view could signal a change in overall Fed consensus for a rate hike sooner (September) rather than later (December). As always, the announcement of Chinese foreign direct investment figures could add some spice to the market, therefore be aware of any significant deviation from last month’s growth.

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

• Primark-owner AB Foods raises earnings outlook
• Abcam says FY revenue up 19.2 pct to 171.1 mln stg
• Georgia's TBC Bank to buy SocGen's 93.64 pct stake in JSC Bank
• Heathrow sets new passenger record for August
• John Laing Infrastructure expects post – Brexit slowdown
• FCA asks Aberdeen to up minimum level of capital held for regulatory purposes
• Copper mired near two – month low
• Oil extends decline amid projected rebound in U.S. stocks