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

UK 100 called to open -15pts, with Asian markets mixed as was the case at the US close, with the better-than-expected US GDP data from Friday being taken with a pinch of salt given the surge in Federal spending in the defense sector (most in three years), although consumer spending was strong.

Much focus, however, is on progress of US Hurricane Sandy (potentially the biggest to ever hit the US eastern seaboard) which is seeing caution prevail, with trading and transport halted or disrupted today and possibly tomorrow.

Hong Kong, real estate particularly, dented by additional stamp duty tax on property. China weak on news from central bank-backed newspaper reported that the chance of RRR cuts have been greatly reduced. The region is still being affected by the weak flow of Q3 earnings reports from the US.

Overnight, macro data seen Japanese Retail Trade weaker than expected, increasing pressure from last week on the Bank of Japan (BoJ) regarding stimulus ahead of tomorrow’s much awaited meeting, especially with the Japanese finance minister saying he expected some bold policy steps.

The UK’s Lloyds Business Barometer improved, but UK House Prices remained weak, falling for the fourth consecutive month.

Over the weekend, Greece concerns back to the fore with German Finance Minister expressing doubts that Greece has fully met all reform efforts and that much remains to be decided (regarding its next tranche of bailout aid).

The UK flagship index continues to test that key trendline of multi-month rising support at 5790 which still offers potential for a potential correction back to 5500, after the decent rally from June.

In FX, GBP/USD continues to fall back from its 1-month trendline of falling highs (mentioned Friday) with potential for a correction back to 1.59. EUR/USD also still in downtrend and nearing lows around 1.29 as fears over Eurozone remain and USD strengthens.

In commodities, Gold has bounced from the $1700 level but a trendline of resistance from 5 Oct remains a hurdle. US Crude Oil stuck around $86 having found support at $85 with concerns over growth prospects given the poor earnings season. Brent Crude up off its lows, and testing Wed-Fri highs as supply issues rein strong. Watch for US Hurricane impact on Energy prices.

This week’s focus will be on whether the Bank of Japan (BoJ) offers any signals of further policy easing and some clarity over the recent speculation that has seen the USD/JPY hit 4-month highs. As always, Friday’s US Non-Farm Payrolls will garner much attention (the unemployment rate especially after last month’s improvement), given its now concrete links with the Fed and its new stimulus programme (QE3).

Elsewhere in the week, look out for Eurozone sentiment (seen deteriorating slightly) and German Unemployment (also seen rising a touch) tomorrow as well as updates on US Consumer Confidence and Housing. Wednesday’s publications include Eurozone unemployment and UK consumer confidence. On Thursday we have China and UK PMI, with the European figures on Friday morning providing the warm-up act to the US unemployment.

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

• Japan               Retail Trade                                        Worse
• Japan               Large Retailers’ Sales                         Better
• UK                    Lloyds Business Barometer                 Improved
• UK                    Hometrack Housing Survey                Still weak
• See Live Macro calendar for all details

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

• F&C Assets fall to £96.8bn in third quarter
• Perform Group Q3 revenue jumps 44%
• CSR launches tender offer at 335-375p/share
• Premier Oil says 98% of bondholders take up exchange offer
• Serco says signs £170m pensions contract
• Bertelsmann and Pearson to merge book businesses