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

UK 100 called to open +10pts, after a negative US session but a positive albeit choppy session in Asian markets overnight. This was down to the bulls awaiting with baited breath the semi-annual testimony of US Federal Reserve (Fed) Chairman Bernanke this afternoon for any possible hints of more monetary stimulus (rate cuts, quantitative easing) to keep the fires of risk appetite alight.

This was despite; last night Moody’s cutting the ratings of 13 Italian banks and major utilities; the IMF’s downbeat comments on growth where it gave the UK the biggest cut to growth forecasts of any developed nation; Weak US retail sales figures which have seen US banks lowering US GDP growth forecasts

Overnight data limited to Aussie New Vehicle Sales which showed growth slowing and a disappointing figure for Foreign Direct Investment (FDI) in China. The latter is often used as a good leading indicator and suggests fears investors exiting the emerging nation, although these are tempered by expectations of more rate cuts by the Chinese central bank to rekindle growth.

Focus today likely on UK and US inflation data, German ZEW surveys and Bernanke’s statement with global growth concerns and the action/reaction/inaction of central banks in everybody’s sights. Greece, Spain and the EFSF issuing short-term debt which will provide more ideas on sentiment towards the troubled nations.

In FX and commodities, Gold gain found resistance at $1596, while Silver followed suit around $27.55. The price of Oil (US Light Crude and Brent Crude) continues to benefit from the US intensification of the embargo on Iranian crude. In FX, USD weaker versus its major peers (GBP, EUR, JPY, CHF) after the weak US retail sales numbers added to market expectation of more US monetary stimulus to kick-start keep economic growth alive.

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

• Aussie              New Vehicle Sales                   Growth Slowed
• China               Foreign Direct Investment      Worse
• EU                    New Car Registrations                        Contraction slowed
• See Live Macro calendar for all details

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

• Wolseley considers future of French business
• San Leon Energy reports successful completion of szymkowo-1 well
• BTG ups full-year revenue view to £190-200m
• Monitise on track for earnings breakeven by end 2013
• Lamprell wins $120.9m Seajacks vessel contract
• London Mining Marampa mine production +26%
• SkyePharma’s flutiform receives regulatory approval in Germany
• Burberry to end licence agreement with InterParfums
• Rio Tinto iron ore output steady on year, sales lag
• IG Group profit +14%, sees modest 2012/13 growth
• AstraZeneca starts new study of heart drug Brilinta
• Cobham unit awarded Lockheed comms contract
• Hochschild says on track to hit 2012 production target
• Dairy Crest says expectations for the full year remain unchanged

Morning Press Selection:

• Iron chancellor bends to will of judges – FT.com – EU Economy http://on.ft.com/NDJtbn
• ECB shows signs of bailout flexibility – FT.com – Europe http://on.ft.com/NtDfw5
• America’s lessons in killing off toxic banks – FT.com – Columnists http://on.ft.com/SCAY5j
• Bernanke unlikely to add to liquidity – FT.com – US Economy http://on.ft.com/SEe4L4
• Investors wary of Italy’s borrowing test – FT.com – Capital Markets http://on.ft.com/NE2eLH
• US dollar is no haven from the eurozone – FT.com – Front page http://on.ft.com/MzNLRW