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

UK 100 Index called to open -40pts at 6680, maintaining its downtrend from mid-last week as momentum soured. After a brief recovery on Friday, 6700 has again been breached to the downside, allowing for a potential re-test of 6670 lows. While momentum has waned, there is still the possibility that this is a pause before another leg higher towards September highs, but all eyes on recent support levels holding early on in the new week. Watch levels: Bullish 6780 and Bearish 6660.

The negative opening call stems from the continued fall-out from OPEC decision late last week not to cut production levels as supply rises in the face of slowing demand, the Swiss voting against buying more gold and the price of oil taking another leg down following key data overnight confirming a slowing China.

Asian equities mixed with Japan outperforming (fresh 7yr high) thanks to the stronger USD/weaker JPY boosting exporters and as the price of oil falls further (big energy importer) and Company Investment and Sales/Profits growth accelerated and despite its PMI Manufacturing edging lower. Note Bloomberg’s Commodity Index at a 5yr low

Hong Kong and Australia in the red due to read-across from China’s official PMI Manufacturing giving up more ground (8-month low) and the HSBC reading remaining flat at a 6-month low. Australia suffering from it having the nation as its biggest export partner, notably for raw materials (commodity index data accelerated declines), denting dual-listed mining names, but benefiting airlines.

Note Aussie Manufacturing data improving, and recovering back to growth and corporate operating profits growth defying recent commodity price weakness.

US markets closed mixed (and early for Thanksgiving) on Black Friday (not the best holiday weekend; sales -11% in second straight annual decline) while Europe closed flat to higher as the USD strengthened further. Over the weekend, the ECB’s Lautenschlaeger said she saw little room for easing policy further despite more deflationary signals, suggesting with effects of sovereign QE being negative.

In focus today we have final Eurozone Manufacturing PMI readings which are expected to confirm deterioration in the region in November, likely adding to the weight of evidence in favour of QE. UK Consumer Borrowing is seen largely unchanged din October, with a cooling in Mortgage approvals. In the afternoon, US PMI Manufacturing and ISM Manufacturing both seen edging down although still growing strongly.

In commodities, Gold at $1160 after falling sharply from Friday’s $1180 to test recent $1130 lows on the news that Switzerland had voted against proposals to force the central bank to boost its gold reserves after selling too much (reserves of 8% versus prior 20%). The metal remains in a 2014 downtrend with potential falling resistance now at $1200.

Note Oil prices giving up more ground with US Light Crude below $65 and its Brent cousin sub $69/barrel on continued digestion of the OPEC decision and additional data from China confirming its slowing growth and thus less need for energy. All the while the US continues to extract more and become self-sufficient, and OPEC pumps as much as ever leaving price-setting to the markets rather than intervening as it has done in the past.

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