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

UK 100 called to open -5pts, despite Asian markets trading higher, playing catch-up with European and US gains of yesterday following better Chinese and US macro (Jobs, manufacturing) data buoying hopes of a global economic recovery. The tepid opening call is likely a function of caution ahead of the all-important US Non-Farm Payrolls this afternoon.

Overnight, macro data limited to Aussie Producer Prices which missed expectations, raising to the chances of a rate cuts and thus keeping pressure on the Aussie dollar (AUD), while the Bank of Japan’s (BoJ) minutes from its recent meeting maintained pressure on the Japanese Yen (JPY) with dovish commentary (more currency weakening stimulus possible, if appropriate).

The UK’s NIESR has said the economy will return to modest growth in 2013 after a slight dip (-0.1%) this year, although this latter prevision is revised up from a prior -0.5% estimate, and the 2013 estimate of 1.1% is down from a prior 1.3%).

Greece remains the European focus, although Spain shouldn’t be far behind, with uncertainty still high on whether the former can secure its next tranche of bailout aid given the Troika’s proposals for budget cuts possibly being unconstitutional, delaying things yet further, and a Greek debt buy back would involve recapitalisations of Greek banks, requiring more money from Europe.

News out this morning has also seen Goldman Sachs cuts its growth forecasts for Japan, adding to the Global and Asian growth slowdown fears.

The UK flagship index has come off its best levels of yesterday, having rallied strongly in the wake of better than expected data and results. Highs of Wednesday proved resistance at 5,865. Pause before another up leg, or correction due? Support now likely restored at 5,800 after yesterday’ breakout and hopefully reviving the rising multi-month uptrend. Beware longer term resistance at 5,915.

In FX, GBP/USD has pulled back after the rally of yesterday saw risk appetite see the greenback dumped in favour of equities and commodities. Although the 1-month downtrend was tested, resistance found at 17 Oct high of 1.618. Possible third rising high in progress at 1.61. EUR/USD back down at lows of late last week 1.289. Support?

In commodities, Gold has fallen back on the reduction in safe-haven seeking (economic data better, could mean less chance of QE and thus inflation for which Gold is considered a hedge). Support found at rising lows around $1709. Resistance likely at 2-day highs around $1729. Rising channel formed. US Crude Oil in rising trend with support at $86.5, while Brent Crude Oil under pressure at $108 near recent lows of $107.5

Q3 results out this morning from Royal Bank of Scotland (RBS) show a bigger loss than expected, although the number of exceptionals and adjustments have made me dizzy. Like with the peer Lloyds Banking Group (LLOY) yesterday the key figure is on the PPI charge of £400m, which as in-line with expectations.

In focus today will be the US’s Non-Farm Payrolls and Unemployment rate for October. The former is seen adding 125K jobs, this after the ADP reports yesterday added 158K. The real worry is whether the much improved unemployment rate last month will tick back up – for Fed Chairman Bernanke who was linked his QE3 programme to the metric and Presidential incumbent Obama whose job is at risk with next week’s elections.

Elsewhere, European PMI Manufacturing for October are unlikely to be as inspiring as those from across the pond and China yesterday. UK PMI Construction might prove closer to growth. US Factory orders close the weak, with an expected rebound in September.

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Overnight Macro Data: (Source: Reuters/DJ Newswires)

• Aussie              Producer Prices Index             Worse
• See Live Macro calendar for all details

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

• Xstrata fires 400 strikers at S. Africa chrome mine
• Admiral posts rise in group turnover, vehicle count
• Exillon Energy says on track for 2012 target
• Aureus Mining announces offering to raise $80m
• Meggitt says Q3 revenues in line
• Bumi appoints Rothschild group as financial adviser
• Hikma Pharma maintains 20 pct revenue growth target
• ITM Power signs deal with ABO Wind of Wiesbaden
• Direct Line says half-way towards cost cut target
• Bwin.party Q3 revenue hit by German tax rules
• Faroe Petroleum relinquishes West of Shetland licence
• Rockhopper granted Falkland Islands extensions
• RBS Q3 results; says expects to enter Libor settlement talks soon