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

UK 100 called to open -25pts at 6815 with the relief rally linked to a Scottish No vote proving short lived as traders price in the uncertainty linked to further devolution of power, the weekend’s G20 meeting put the focus back on uneven economic growth and reliance on monetary stimulus, and concerns about a slowing China were exacerbated by further declines in commodity prices.

The weekend’s G20 meeting of finance chiefs and central bankers put the focus back on economic growth and monetary policy by saying low interest rates could lead to a potential increase in financial-market risk as major economies rely on monetary stimulus to bolster uneven growth.

A major contribution to the negative start to the week comes from mining sector under pressure overnight in Australia with names like BHP Billiton (BLT) and Rio Tinto (RIO) down over 2% after a decline in commodity prices and iron ore hitting fresh 5-year low, and the smaller producers hit even harder – all hurt by concerns about Chinese growth.

Stocks in Asia immersed in red brushing off another record high finish for the DJIA with China and Hong Kong down over 1.3% on concerns of a softening Chinese economy and a cash crunch. We have more data out this week and there is speculation as to whether the nation will accept slower growth than the 7.5% GDP target..

While global futures continue to give up gains from late last week, note S&P500 futures have found support at the key 2000 level and DJIA at 17200.

In geopolitics, Ukrainian President Poroshenko said tensions in the country’s easternmost regions has been easing, even as a 5 Sept truce agreement was being violated. After the Scottish referendum, note the Catalan parliament passed a bill to allow an independence referendum on November 9^th.

US stocks closed mixed around breakeven on Friday, with the DJIA managing another record high close, however most were unable to join the fanfare surrounding the largest IPO in history, with Chinese online retailer Alibaba seeing its shares open 36% higher than the IPO price.

Another boost was given to M&A with German engineering giant Siemens (SIE) announcing the $7.6bn purchase of US oil-equipment maker Dresser-Rand (DRC).

The UK 100 index has pulled back to Thursday’s close, but its late Thursday breakout from the September downtrend is still technically intact while it remains above 6800. With rising lows from Wednesday there is potential yet, with an appropriate catalyst, that the index can go on to revisit the 6900 level that the futures index tested briefly on Thurs night/Fri morning.

In focus today, we have the Chicago Fed Index this afternoon, before ECB President Draghi speaks following the poor uptake of TLTROs last week (lots of ECB speakers saying QE not on the agenda and CNBC saying Germany wouldn’t accept it). Then Eurozone Consumer Confidence is seen pretty much unchanged while US Existing Home Sales are forecast to have grown at a slower pace in August.

In commodities, Gold maintains its southerly trajectory now trading below $1215/oz, even if off its worst levels of $1208/oz, and now risks erasing its gains of 2014 as the outlook for higher US borrowing costs strengthens the USD, offsetting demand for the metal as a store of value be that straight safehaven or inflationary hedge .

In Oil, both US Light and Brent crude remain under pressure with the former back around $91/barrel and the latter hugging its recent $97-98 lows ahead of PMI Manufacturing data from China tonight and the US Eurozone tomorrow, with focus back on China (world’s second largest oil consumer) after the poor run of data last week.

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

• Tesco says overstated expected first half profit
• London Mining says in dispute with Glencore regarding cash prepayment
• Laird says CFO to step down in May 2015
• Dairy Crest says expect Hanworth Dairy to be operational for further two years
• Suit specialist Moss Bros' first-half profit slips
• Bellzone Mining requests AIM to suspend trading in light of uncertainty
• UK lender Aldermore says will float on London Stock Exchange