Markets Overview:

UK 100 called to open +10pts at 7360, holding another bounce off mid-Feb rising support at 7335. Bulls need a break above yesterday’s 7393 highs to build on the support/bounce. Bears require a breach of rising support at 7335. Watch levels: Bullish 7400, Bearish 7330

Calls for a positive open come thanks to a weakening in GBP as local elections deliver a post-Brexit backlash to the bigger parties. Asia (just Australia, with Japan and Chain closed) just offside weighed by financials. Miners mixed. Oil weak amid an easing of supply concerns. Gold lower amid USD strength ahead of jobs data.

In corporate news this morning:

HSBC Q1 Net interest income $7.47B misses $7.73B est; Net op income $13.84B misses $13.9B est; adj. Pre-tax profit $6.35B (+9.5% YoY) beats $5.69B consensus; Reported pre-tax profit $6.2B (+30.7%) beats $5.58B est; CT1 Capital 14.3% (+30bp) beats 14% est; NIM 1.59% (-8bp YoY) misses 1.66% est; Return on avg. tangible equity 10.6% (+2.20pts) beats 10.5% est. “Alert to risks in global economy... proactively managing costs and investment in line with more uncertain outlook.”

Smurfit Kappa Q1 revenues +7% YoY; EBITDA +25%. Volumes +2% in EU, +3% in Americas. “there is invariably political and economic risk, we confidently expect... another year of progress”.

ConvaTec Q1 revenues -6%, flat organic excluding one-off accounting provision; backs FY guidance; negative trends in US and UK more than offset launch of Aquacel. US ostomy care sales remain soft but LatAM and Asia Pacific solid. Continence and Critical Care sales  +3.1% organic.

IHG Q1 Global comparable RevPAR -2% (+0.3% at constant FX; Rate +0.6%, Occupancy -0.2pts), US RevPAR +0.6%. On track for $125m annual savings. “financial position remains robust, with ongoing commitment to efficient balance sheet and investment grade credit rating.”

INTU Properties Q1 stable but expects challenging 2019; cuts with FY like-for-like net rent income guidance to down 4-6%. Q1 signed +£6M of leases at 1% above previous passing rent.

Ultra Electronics sees further positive developments in order book; trading in line. New "Focus, Fix, Grow" initiative and move to average working capital throughout year producing positive early results. Remains confident 2019 will be a year of good underlying progress.

AstraZeneca Qternmet XR approved in US as oral adjunct for type-2 diabetes.

Merlin Entertainments says trading for a seasonally quiet period consistent with guidance.

In focus today:

A busy end of the week for investors starts right off with the UK Services PMI (9:30 am), which are expected to show slight growth from 48.9 to 50.5. Watch GBP and the UK Index for their reaction.

The main highlight of the European session will be the Eurozone Inflation (10 am) which may show  a pick-up from 1.4% to 1.6% (best since Sept) and the Core metric rising back to its 1% average over the last 2 years. Watch any impact from the EUR on the GBP.

The highlight of the day is the US Non-Farm Payroll (1:30 pm). Job gains are expected a shade lighter than last month to 180k, however we not last month’s ADP print was much stronger. A pickup in wages could spark inflationary pressures. A slowdown in figures for PMI services, from 55.3 previous to 52.9, will cap off a week of mixed data and results from the US.

Quarterly results season continues with  Equifax, Marriott International and Viacom reporting from across the pond.

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