UK 100 Index called to open +10pts at 7020, continuing last Tuesday’s bounce (second leg of December Santa rally) and, importantly, getting up and away from 7000 early doors. Bulls need overnight highs of 7030 to be bettered to open the door for last Sunday’s 7065 highs and October all-time highs of 7135. Bears require a troubling of overnight lows of 7010, if not a breach of rising support at 7000, to hint at potential for a bearish reversal. Watch levels: Bullish 7035, Bearish 6995.

Calls for a positive open come in spite of a mixed Asian session to kick off the new trading week following small losses on Wall St on Friday. Oil price buoyancy is helping sentiment to a certain extent, despite the USD pulling further back from last week's Fed rate hike inspired highs. This is due to weekend geopolitical tensions after China seized a US underwater naval drone and President-elect Trump weighed in with another case of Tweet first, think later.

Australia’s ASX is the standout performer with Oil continuing to rebound from its OPEC/Non-OPEC production cut scepticism lows of last week, helping Energy names. Gold and its miners are also benefiting from a weaker USD, although industrial metals (Copper, Iron ore, Aluminium, Zinc, Nickel, Lead) remain under pressure.

Japan’s Nikkei hovers around break even before the Bank of Japan’s (BoJ) policy update tomorrow. USD weakness bringing the Yen off recent lows is denting sentiment towards exporters in spite of better than expected trade data that continues to improve. China and Hong Kong equities are weak on aforementioned geopolitical events.

US equity markets slipped away from record highs on Friday as US-Chinese geo-political tensions and 2017 Fed rate hike scepticism weighed on market sentiment. The Nasdaq underperformed its peers (-0.3%) as Tech names came under pressure, whilst a weak performance from the Financial sector contributed to losses on both the Dow Jones (-0.05%) and S&P 500 (-0.2%).

Crude Oil prices have continued Friday’s breakout from the post-OPEC and non-OPEC production cut downtrend amid reports of setbacks for Libya’s production aspirations, despite USD weakness due to a fizzling out Fed rate rally and geopolitical tensions weighing on the global currency.

Gold price has rallied back above $1140 overnight as the Fed-inspired USD rally has seemingly come to an end, however still remains in its monthly downtrend. A lack of meaningful macro data today could see the USD slide continue, helping the precious metal to recover further from the fresh 10-month lows it posted last week.

On a quiet day for macro data, in focus today will be German December IFO Surveys, all expected to show slight improvement since November with the Business Climate figure attempting to post a fresh 2016 high (albeit by a very slim margin). These figures have obvious importance for the Eurozone given Germany’s position as the powerhouse for the European economy.

One hour later, Eurozone Construction Output for October and Q3 Labour Costs are released, with the monthly figure for the former expected to remain under pressure, negatively impacting on the yearly figure which is seen continuing its ongoing decline that started in July. Q3 Labour Costs are expected to improve upon Q2’s downside miss.

Finally, US Services PMI is seen virtually unchanged, however the first speech from US Fed Chair Janet Yellen since last week’s rate hike after market close will likely have a greater impact on stateside bourses this evening.

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

• Brewin Dolphin buy Duncan Lawrie Asset Management
• Speedy Hire has bought Lloyds British Testing Ltd
• GVC Holdings says reached deal to sell Kalixa group
• WH Ireland says cautiously optimistic about year ahead
• Johnston Press changes super senior credit facility
• BP, Kosmos Energy announce partnership in Mauritania and Senegal
• Iran finalises 100 – jet deal with Airbus, first delivery in January
• Vodafone eyes role in traffic control for drones – FT
• Glencore prices tender offers
• Oil prices rise in anticipation of tighter 2017 market