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

UK 100 called to open -25pts at 6630. The index has broken below rising support, which could lead to a further pullback towards 6600. A risk-off afternoon could even see this extended to 6500. Bulls, however, will note the market’s reaction to the Nov. 2015 Paris attacks and look for a similar treatment of last night’s tragic events in Nice. In that case, a bounce back up above the key 6660 level could see momentum take the index above 6700. Watch levels: Bullish 6660, Bearish 6590.

The negative opening call does of course come in the aftermath of an overnight terror attack in Nice in which a lorry was driven through crowds celebrating Bastille Day, killing around 84 people. The subject of terrorism is sure to dominate headlines today, with attention also sure to focus on what this means for the evolving shape of the political landscape in France and the US (Le Pen, Trump sure to gain more support), not to mention how the UK views this in light of having just voted to leave the EU.

Asian bourses are off their highs, yet on track to close out a strong week this morning after Chinese data showed the world’s 2nd biggest economy held firm in Q2, with growth coming in at 6.7%, beating expectations slightly. Japan’s Nikkei up around 1.1%, helped by heavyweight stock Fast Retailing (owner of Uniqlo) which soared 18% on a solid revenue outlook (Nintendo still doing well on Pokemon mania) as well as the more traditional weaker Yen. Note Japan’s Toppix index up 9.2% this week - its best weekly performance since Apr 2009.

US bourses made it a fifth up day in a row, and a fourth for fresh all-time highs, their longest streak of record peaks since November 2014. Help was at hand via a slightly weaker USD after the GBP strengthened in response to the Bank of England (BoE) leaving policy unchanged until next month. The S&P500 made a fresh high thanks to 9/10 industry sectors rising, banks by the most.

Better than expected results from JPMorgan (JPM) made for a good start to the Banks’ earnings season even if - like many companies - profits are down heavily versus last year, and the outlook is tough in a Brexit scenario. Chat from the Fed’s George tempered economic resilience with a stronger USD hurting exporters, while Lockhart said he couldn’t rule out two rate hikes this year, data depending of course. Note the IMF Chief Lagarde saying it may cut global growth forecasts next week.

Crude prices are back down around yesterday’s lows as traders book profits, the commodity still weighed by longer-term falling highs and with surprisingly little help from solid China growth data overnight. Interest rate sensitive Gold is still on the back foot after the Bank of England held fire on more stimulus, although it is at least off its worst levels of $1320.

In focus today will be last night’s tragic Bastille Day attack in Nice (France), which has seen the country targeted for a third time in just 18 months and adds to a truly horrific tally and worrying frequency that is becoming increasingly difficult  to comprehend.

After yesterday’s Bank of England (BoE) update what Governor Carney has to say will be of much interest, especially regarding updated forward guidance on what stimulus to expect next month.

Data-wise, lacklustre Eurozone Consumer Price Inflation (CPI) likely remains a thorn in the side of ECB President Draghi. US Retail Sales are expected to have slowed on a headline basis but core measures probably held up. US CPI is seen confirmed at just half the Fed’s target, although the core measure likely held up just above target.

US Empire State Manufacturing may have edged back in July, Industrial and Manufacturing Production probably rebounded from a weak May although higher Capacity Utilization may suggest lower efficiency. Expect flat US Business Inventories and Consumer Sentiment and a potentially higher US Baker Hughes Rig Count that could put more pressure on Oil prices.

Other speakers include the Fed’s Williams, Kashkari and Bullard in the evening.

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

• BP's Gulf-Spill Tab Hits $62 Billion -- WSJ
• Anglo Pacific Group sees first royalty income from Salamanca in 2018
• Faroe Petroleum says raised 62 mln stg through placing
• Homeserve says trading in – line with expectations
• Indivior announces intention to list ADRs in U.S.
• Handelsbanken posts solid Q2, says well – equipped to handle Brexit
• Melrose receives final regulatory approval for Nortek offer
• DCC continues to expect FY profit group
• Firstgroup sticks to FY outlook, says too soon to judge Brexit impact
• Nintendo trading volume hits record for individual stock on Tokyo bourse
• Tesla Exploration provides update to credit facility negotiations
• Mosman Oil and Gas Investment and Operations Update
• Shanta Gold Limited Pilot-scale production to commence at Singida