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

UK 100 Index called to open +5pts at 7320, holding yesterday’s 7310 which confirms a bullish ascending triangle reversal that could propel the index back above 7400. Bulls need a break above overnight highs of 7330 to maintain confidence. Bears require a break back below 7310, if not rising support at 7300. Watch levels: Bullish 7330, Bearish 7300.

Calls for another positive start come after a positive US close extended into Asia overnight. This on revived and increased hopes of President Trump succeeding in implementing significant US tax reform after unveiling a framework that would benefit many listed corporates. It would also be the first element of fiscal stimulus to accompany the Fed on its path of policy tightening which has pushed the USD higher.

Japan’s Nikkei is higher thanks to USD strength helping push the Yen lower to the benefit of exporters and the tech and financial sectors welcoming news of US tax reform and the prospect of tighter US monetary policy. Australia’s ASX underperforms as commodity prices smart (metals more than oil) from fresh USD strength, outweighing gains for financials.

The aforementioned USD strength has potential to benefit both the UK Index and DAX again via continued GBP and EUR weakness.

Company headlines include: TUI reiterating FY17 guidance of >10% underlying EBIT growth; sees trading for future seasons in line with views. Imperial Brands on track to meet FY earnings views at constant currency. Allied Minds SciFluor SF0166 study positive top-line results.

US equity markets reacted positively to a more detailed framework of the Trump administration’s tax reform plan, most notably Tech stocks expected to benefit from a repatriation tax holiday. This was reflected in the Nasdaq’s outperformance, rallying over 1%, while the Dow Jones ended a 4-day losing streak thanks to gains for Financials and the S&P 500 touched a fresh intraday all-time high, although failed to notch a fresh closing high.

Crude Oil benchmarks have continued to retreat from multi-month highs as the US dollar extends its rally while investors look to take profits. Global benchmark Brent has fallen faster than its US equivalent, falling back below $57.5 as concerns about Kurdistan exports following the overwhelming vote for independence weigh, while US crude has broken below $52.

Gold has fallen to a fresh 1-month low of $1278 as the US dollar continues to rally from 33-month lows, while hawkish central bank speak further adds to the bearish drivers for the non-yielding asset. After ticking marginally higher in the early part of Asian trading, the precious metal has since dropped below $1280 for the first time since late August. A host of central bank speakers today could influence Gold throughout the day.

In focus today will be digestion of Trump’s US tax reform announcement last night, something he has campaigned on since the beginning, designed to kickstart the economy. It nonetheless appears very skewed to corporates (big rate cut, cash repatriation holiday) rather than individuals (fewer brackets, but bands TBC). And it’s still merely a framework, 11 months since his election.

Data-wise, European confidence figures (10am) are seen pretty much unchanged, along with German Consumer Price Index (1pm), while US GDP (1.30pm) is confirmed having jumped in Q2 but its inflation metric cooled.

A range of central bankers are scheduled to speak today, including Bank of England Governor Mark Carney (9:15am) opening the BoE’s conference celebrating 20 years of monetary independence, the ECB’s Lautenschlager (12:10pm) delivers a keynote address on financial supervision, while a trifecta of Fed Speakers are slated to speak this afternoon, including non-voter George (2:45pm) on the economy and monetary policy, Vice Chair Fischer (3pm) at the BoE conference and incoming voter Bostic (6pm) on careers in economics.

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

• TUI Backs FY 2017 Guidance Despite Impact of Hurricanes
• TUI Reiterates FY17 Guidance of at Least 10% Growth in Underlying EBIT
• Imperial Brands Says on Track to Meet Full-Year Expectations
• Imperial Brands says on track, working on Palmer & Harvey rescue
• Euromoney Expects 6% in Revenue for FY 2017
• Stagecoach Sees FY18 EPS in Line With Expectations
• Stagecoach says expectation of EPS for FY 2018 has not changed
• Allied Minds SciFluor SF0166 study positive top-line results
• SSP Group expects 11.4 pct rise in full-year revenue
• Oil falls as U.S. data shows mixed picture
• RPC expects H1 to be well ahead of expectations
• CMC Markets sees H1 profit up as client trade volumes rise
• Gold hits over 1 – month low; palladium races past platinum
• Moss Bros reports solid first – half profit growth
• Insurance market Lloyd's of London pre – tax profit drops 16 pct
• Bowleven says discussions regarding proposed bomono project farm – out agreement are progressing
• Moody's maintained stable outlook for Germany's banking system on resilient economic growth