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

UK 100 called to open +35pts at 6185, with an overnight bounce off 6160 keeping the recovery rally towards 6200 alive. Of note is yesterday’s breakout beyond May falling highs and the trendline turning supportive overnight. Bulls will be watching for a break above 6200 to open the door for a double-bottom inspired rally towards 6430 May highs. Bears will be hoping that last week’s highs prove too much of a hurdle to overcome. Watch levels: Bullish 6205, Bearish 6150.

The positive opening call comes as Asian markets post gains to follow their US counterparts higher. This comes as Oil prices continue their northerly march towards $50/barrel to buoy energy names (and commodities in general)  while news of Warren Buffet taking a significant stake in Apple gave a boost to tech.

Japan’s Nikkei and Australia’s ASX both have energy names leading the way. This is thanks to oil price gains trumping regional currency strength derived from weaker US dollar which has pulled back from its highs to maintain bullish sentiment in the commodity space  - base metals in particular. Note the ASX unhindered by slightly more hawkish RBA central bank minutes.

US bourses closed in the green, tracking the oil price higher with Brent and WTI making fresh multi-month highs,  benefitting from a bullish outlook upgrade from GODman Sachs as well as more supply disruptions stemming from equipment failure and political squabbles in places like Nigeria and Venezuela - both major producing nations.

Warren ‘The Messiah’ Buffett helped US markets too by buying a ~$1bn sack of Apples (AAPL) even though he has no idea how to value tech companies (by his own admission…). Macro-data naturally taking a back seat in the buffett church, with little in the way of significant market wobbles as Empire Manufacturing fell sharply into negative territory (to -9.02 in May from +9.56 in April).

The Richmond Fed’s Lacker is extolling a June rate hike, observing that inflation is moving nicely in the direction of the target 2%, labor (not labour) markets are still supportive of economic growth, and the risks that have hitherto been rate hike negative look to be evaporating.

In reaction to such a booming argument, San Fran governor Williams sought to remind markets he still exists by not really saying anything (slow and steady, data dependent, inflation, yadda yadda). As always things like the above can move the USD which will no doubt have a knock-on for Gold, enjoying a marvelous winning streak thus far in 2016 and yet to benefit further from a host of Hedgefunders piling into bullion.

At least one of those has a massive short position in the S&P500 too. Be watchful of the current drivers for Gold’s performance - speculation is helping the yellow metal to track risk assets at the moment, while Hedge Fund interest is likely more to do with risk aversion.

In focus today will be UK Inflation data with headline figures for CPI, RPI and PPI all seen cooling in March which will only add to the hopes of lower for longer rates and the argument that Brexit uncertainty is seeing investment decisions postponed.

In contrast, this afternoon, US CPI is expected to have accelerated in April likely helped by the rising oil price recovery, while higher US Housing starts and Permits would be supportive of Friday’s jump in Consumer Confidence. To close the day, US industrial Production  is forecast to rebound in April although note the unexpected cratering in Empire State Manufacturing yesterday while Fed speakers after the European close influence late sentiment.

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

• BTG says pretax profit doubles for FY
• AstraZeneca Reports Positive Results From Asthma Drug Trial
• Taylor Wimpey Raises Dividend Payout Target; Lifts 3-Year Targets
• ITE Group says GPP Energy Advisors sold 4.6 m shares of ITE
• Vodafone reports underlying earnings growth after European recovery
• Lookers sees FY trading in-line with expectations
• Premier Foods quarterly revenue rises
• Gem Diamonds says recommended once off special dividend
• DCC FY pretax profit from cont ops +47%
• DCC Raise FY16 Dividend; Sees Another Year of Profit Growth
• Land Securities says potential Brexit to hurt UK property market
• Land Securities FY16 Pretax Profit Tumbles
• Enterprise Inns H1 underlying pretax profit flat
• Vodafone Qatar to cut staff as losses widen; chairman quits
• UK competition watchdog unveils measures to improve banking competition
• Betting odds indicate 73%probability of UK vote to stay in EU – Betfair
• John Laing Infrastructure fund says portfolio performing well
• France's Hollande says EDF's Hinkley Point project should go ahead
• Greencore H1 op profit up 8.%, UK remains difficult