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

UK 100 Index called to open +20pts at 7555, back from yesterday’s 7580 peak, but holding 3-day rising support at 7550. Bulls need a break above shallow falling highs at 7575; Bears require a breach of 7550 (overnight lows, rising support). Watch levels: Bullish 7580, Bearish 7545

Calls for a positive open come on the back of positive (albeit lacklustre) close on Wall St, where President Trump softened some of his China trade rhetoric to the delight of Tech (no new investment restrictions; use existing protection mechanisms), although Asia trading was mixed overnight as global trade and tariff worries and uncertainty continue to simmer.

Oil prices rallied hard overnight after US API oil stocks posted a massive 9m barrel drawdown (largest since Sept. 2016) and the US ratcheted up pressure on oil importers to eschew deliveries from sanctions-hit Iran. UK Index Energy could continue to benefit from the post-OPEC rebound, to extend the February rally.

Gold trades its lowest since mid-December as alternative safe-havens JPY and USD firm versus peers (corresponding GBP weakness helping buoy the UK Index ), helped by a lukewarm return to appetite for risk assets.

In corporate news this morning, UK Housebuilders may like June UK Nationwide House Price growth rebounding more than forecast (0.5% MoM vs 0.2% est.) after a weak May (-0.2%) with annual growth slowing less than expected (2% YoY vs 1.7% est vs 2.4% prev).

Whitbread Q1 UK like-for-like sales -1.3% (Costa -2% on footfall weakness in shopping locations; Premier Inn -0.9% on weak market conditions in London); cautious of shorter-term trading conditions FY guidance changed, progressing with Costa demerger (more details in Oct).

FT reports that Takeda chief brushes off concern about key Shire unit; Hedge funds push regulator to set Sky floor price.

AstraZeneca says Lynparza significantly delays disease progression of ovarian cancer in Phase III SOLO-1 trial. Bunzl H1 trading consistent with Q1 expectations; revenues +5% organic, 6% M&A boost, 6% FX headwind; acquisitions important for growth strategy, expect more through year-end.

ITV CFO Ian Griffiths to retire within 12 months. IWG 2018 operating profit now expected £15-20m below management's previous expectations. Ultra Electronics majority of ops had better order intake, expect H1 revenue and profits in line with guidance, but Herley still weak, so expect £4-6m impact on profits. FastJet at risk of suspension, in talks with shareholders about raising funds.

In focus today will likely be the Bank of England Financial Stability Report (9.30am) and speech from Governor Carney outlining the FPC’s view on the stability of the UK’s financial system.

In terms of data, it’s all very US-focused with US Durable Goods Orders (1.30pm; economic growt proxy) expected weaker in May, but Pending Homes Sales (3pm; consumer confidence proxy) rebounding before US EIA Crude Oil inventories (3.30pm). Note API data showed a huge drawdown in Crude that helped oil extend its rebound overnight.

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