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

UK 100 Index called to open +15pts at 6810, testing the highs of late yesterday. This suggests bullish appetite for a breakout to extend a 2-day bounce from 6750 towards Tues/Weds highs and the ceiling of the current sideways channel at 6850. Bulls look for a breakout to 6815 or better. Bears want to see a drop back to test 6790. Watch levels: Bullish 6820, Bearish 6785.

Calls for a positive open in Europe come thanks to Fed Chair Janet Yellen sending the USD through the roof by suggesting a December rate hike could be appropriate ‘relatively soon’ which markets take as next month. The reciprocal of this - a weaker GBP and EUR - are thus helping sentiment towards the UK’s UK Index and German DAX, seen helping the army of internationally exposed corporates on the former, and exporters on the latter, even if dollar-denominated commodity prices are being hindered.

Japan’s Nikkei has technically entered a bull market (+20%) thanks to the USD spike sending the Yen (USD/JPY) back to levels last seen end-May, helping export names in terms of perceived competitivity. The index is understandably outperforming in Asia overnight. Australia’s ASX is also posting gains in spite of commodity prices under the cosh - both metals and oil - with financials following US counterparts higher, perhaps helped by buoyant China property price data.

US equity markets closed higher after decent macro data (housing, inflation, jobless) and Fed Chair Yellen’s hint about a December rate hike. While the Dow was hindered by WalMart results, a continued tech bounce helped the Nasdaq and financials assisted the broader S&P.

Gold has begun a second leg down derived from the USD surge making it more expensive, while continued equity gains and a bond market turnaround (prices down, yields up) dent demand for the zero-yielding safehaven. A bearish flag has already taken it back to flirt with intersecting 12-month support at $1200.

Crude Oil prices are off their best levels on account of the strong USD, however, yesterday’s swings/volatility shows just how much oil minister comments from OPEC members (optimistic of course) are likely to move barrel prices as we edge towards the month-end production cut meeting in Vienna. Support overnight for both US ($45.5 and Brent $46.7).

In focus today - top-tier macro data distinctly lacking until late afternoon - will be a raft of speakers to keep us on our toes, hot on the heels of Fed Chair Janet Yellen who yesterday suggested a US rate hike could come ‘relatively soon’ sending the USD through the roof.

First up is ECB President Mario Draghi just after the European open, giving the keynote speech at the European Banking Congress in Frankfurt. While his views are always of interest, they will perhaps be more-so after yesterday’s ECB minutes gave a very bleak outlook assessment for the Eurozone and suggested further stimulus (extension of QE programme) at December’s policy update.

Draghi’s ECB colleague and German Bundesbank head Jens Weidmann speaks mid-morning (doesn’t like excessive stimulus) along with the Fed’s Bullard (non-voter; “would be surprised if no hike in December”). He will be followed by colleagues George (non-voter; pro-rate hike) and Dudley (voter; “soon”) mid-afternoon and Kaplan (non-voter; “prudent”, “risks in waiting too long”) this evening.

Macro data of significance includes the US Leading Index seen growing a little slower in October, while the Kansas City Fed Manufacturing will give us additional evidence about the state of US economy while the Baker Hughes Rig Count will tell us how much more drilling activity there is stateside.

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

• Botswana Diamonds Narrows FY Loss After Tax
• Bodycote Keeps 2016 Targets Despite Challenges
• Chilean miner Antofagasta on track to cut unit costs to 4 pct below target
• Emirates Airline having technical issues with new A380 engines
• Electrocomponents 1H Pretax Profit Rises, Lifts Savings Targets
• Nationwide Building Society profit falls to 615 mln stg
• CPPGroup sees FY underlying oper profit to be materially ahead of expectations
• FCA flags wide – ranging concerns about asset management industry
• Grafton says to acquire tool distributor Gunters en Meuser B.V
• Jimmy Choo sees full – year margin improvement, cash generation
• Oxford Instruments sells superconducting wire unit for $17.5 mln
• Fuller Smith & Turner says H1 adj. pretax profit at 22.8 mln stg vs 21.6 mln stg yr ago
• GKN to shut GKN Yeovil at the end of 2017
• Copper slides as dollar surges after Yellen signals looming rate hike
• Oil prices fall as strong dollar wipes out OPEC cut optimism