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

UK 100 called to open +15pts at 6780, after a mixed session in Asia-Pacific where the main events were the RBA leaving rates unchanged and the AUD/USD weakening (helping exporter equities) on more bearish talk of the currency pair being uncomfortably high but policy settings unrevised.

The positive bias maintained by a raft of PMI Services improvements in September, especially in China (where the PBOC injected more cash to calm money markets), while UK BRC Sales accelerated. There was also more dovish talk from Fed members with Rosengren saying the FOMC could afford to be patient in deciding when to taper (as we expect will be the case).

Note China in the red ahead of the world’s #2 economy’s big political meet to decide on economic policy as it heads for the slowest growth in over two decades. Shares down on concerns that reforms will be disappointing.

US bourses closed positive supported by Fed’s Bullard saying no hurry to taper (wants to see more inflation) and Powell that policy to remain highly accommodative before Rosengren chipped in after the close.

Data also helped US gains with ISM New York jumping to 59 while the ECB’s Asmussen maintained that a bank resolution fund should be in place by 2015 although the Italian Finance minister warned on strong EUR, and urged ECB to ease policy to help SMEs.

In focus today we have UK PMI Services which is seen ticking back in October, although still remain above the impressive 60 level in September. Thereafter, we really only have US ISM non-Manufacturing to look forward to on the data front, with it seen slipping a touch but holding 54 but US Economic Optimism jumping above 40.

After dovish suggestions from a Fed member, colleagues update this evening (Lacker, Williams), however, it may be more interesting to hear what ECB peers have to say with the bank’s president and several others talking today, especially with so much talk of deflation meaning need for a rate cut on Thursday.

Last night Twitter upped its IPO price range by 25%. Likely on strong demand, but also what Facebook dis before its disastrous market debut last May. Any parallels to be drawn? This morning results from Marks & Spencer look at odds with ABF with sales for the discount retailer faring better and the former reporting yet another quarterly fall in underlying sales. Balfour Beatty expects 2013 results to beat expectations.

The UK 100 has slowed up before 6800 having rallied from 6715 lows late last week. Anticipations of accommodative central banks still helping, alongside some strong macro data. Support 6715, resistance 6800.

In FX, USD basket back from best levels of 81 although found support at 80.6 despite dovish  commentary by Fed members. Resistance found at highs of mid-October. GBP/USD still in downtrend from 25 Oct, although found support at 1.59. Resistance possible around current levels after bounce USD strength is the hindrance. EUR/USD also down on USD strength, bouncing off 1.345 which was the breakout on 18 Sept. ECB talk today could be interesting.

Gold still under pressure from strong USD but off worst levels of $1305. Not really helped by dovish Fed member comments. Resistance still strong at $1350.

For any help you may require placing trades or in terms of market information, put a call in to our trading floor – all part of the service.