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

UK 100 called to open -5pts at 7215, up off yesterday’s 7209 lows but still hampered by this week’s falling high resistance at 7235. Bulls need a break above these overnight highs to overcome this week’s downtrend. Bears require a breach of 7200 to extend this week’s decline. Watch levels: Bullish 7235, Bearish 7200

Calls for a negative open come after mixed trading in Asia where equities lacked general direction on account of US markets closed for the Presidents Day holiday and uncertainty ahead of US-China trade talks, which are scheduled to resume in Washington but with major differences unresolved. Investors also await Fed minutes tomorrow evening while oil prices have plateaued.

Company news this morning: HSBC FY revenues +4.5%, pre-tax profit +15.9% (adj. +2.8%), missed consensus due to costs +6%; div flat; committed to scrip div neutralisation with buyback; Jan ahead of plan, preparing for Brexit, committed to targets despite tough markets and weaker global outlook; shares -1.4% in HK.

BHP H1 underlying profit -8% to $3.73bn (missing $4.37bn consensus), op. cash flow -1%, net debt -36%, capex +22%, dividend flat. Productivity hit of $835m for production outages, seen flat for full-year (down from $1bn guidance). FY costs and capex guidance unchanged. Shares flat in Australia.

InterContinental Hotels  FY underlying reportable segment adjusted operating profit +6% to $805m beats $791m estimate; underlying revs +6%, div +10%, net debt -17%, cash flow +18%, net capex -22%, RevPar +2.5% (Q4 +1.9%), rooms +4.8% (+4.3% organic); on track for $125m savings by 2020; Capex unchanged.

Cobham reached an agreement with Boeing to settle KC-46 claims. To take £160m non-underlying charge in 2018 (£86m settlement + £74m in extra costs). Payment to Boeing offset by some unpaid invoices and will total £49m in H1’19. Boeing stopped withholding payments and contract still in place. WARP qualification schedule reset, expected to complete mid-2020.

Greggs expects FY profits ahead of guidance after an exceptionally strong start to 2019 boosted by vegan sausage rolls; like-for-like sales +9.6% in 7 weeks to 16 Feb. Strong trading to have material positive impact on H1 results.

Go-Ahead Group acquired Manchester Depot, including 163 buses, from FirstGroup for £11.2m. 888 acquired Costa Bingo for £18m cash, o/w £12m upfront and $6 in Sept 2019. Indivior reports Sublocade injectable opioid use disorder treatment met primary and key secondary endpoints in the 24-week pivotal trial

Spectris FY slightly ahead of guidance but sales to moderate in 2019 due to cautious macro outlook; early conclusions of strategic review suggest group should be more focused; FY sales +5% like-for-like, operating profit +4% (+6% after project uplift costs), pre-tax +3%, dividend +8%.

RPC publishes scheme document for 782p/share takeover by Apollo; still engaging with Berry which is also considering a cash offer. First Group Q3 revenue +13.7% YTD, in-line with expectations. Greyhound still faces difficult trading environment. FY guidance for higher cash inflows unchanged

In focus today, alongside the US return from a long weekend Presidents Day holiday, will be UK Wages and Employment (9:30am), significant for its inflationary read-across. Average Earnings growth is expected to have accelerated in December (including bonus +3.5% vs 3.4% previous; ex-bonus +3.4% vs +3.3% previous), while Unemployment holds firm at 4%.

From the Eurozone, we get February’s German ZEW Surveys (10am), where economic sentiment may recover slightly, though still in negative territory for an 11th straight month. Eurozone economic sentiment, likewise, remains depressed, albeit recovering from 5-year lows. Stateside, the US NAHB Housing Index (3pm) could see a 2nd month of improvement from November’s 3-year low.

Speakers include the ECB VP de Guindos (10:15am) on a panel for ''Euro at 20 years: The road ahead'' while outgoing ECB Chief Economist Praet (3pm) is on a panel discussion "Europe between departure and frustration: how do we achieve more integration and stability?" In the US, the Fed’s Mester (1:50pm, non-voter, hawkish) speaks on the economic outlook and monetary policy at an Economic Forecast event.

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