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

UK 100 called to open +35pts, with risk sentiment getting a boost from news that Greece’s creditors have finally (hallelujah!) reached a deal to allow the beleaguered sovereign to receive the next tranche of bailout money it needs. US markets may have closed lower on fiscal cliff uncertainty, but Asian markets buoyed by the news from Brussels.

The Greek deal involves a reduction in its debt to GDP ratio to 124% by 2020 and <110% by 2022, a compromise between the troika of bailout lenders (EC, ECB and IMF) and helped by a complex combination of debt buy-backs, return of ECB intervention profits, lower (in some cases deferred) interest payments and extended payback schedules on loans. Note no public sector haircuts on Greek debt, yet.

Overnight, macro data from China showed an improvement in Industrial Profits during October, more positive data towards the growth-slowdown-has-bottomed-out theory.  This was, however, countered slightly by Japanese Small Business Confidence deteriorating a touch form an already poor reading, bringing back to the fore the nation’s economic woes. This morning, good news also from Germany that its Import Price Index was less inflationary than expected which could help the nation consume and produce more cheaply.

Asian markets also helped by continued strength in Japanese equities (Nikkei) ahead of the mid-Dec election and the prospect of a new pro-easing leader in the form of opposition leader Abe, although after severe weakness, the Yen (JPY) has recovered slightly versus the dollar (USD).

While the nagging doubt of Greek sustainability may have been removed, note that the UK 100 has failed overnight to break its Friday and 13-day highs prior highs. This begs the question of whether a breather after the recent sold up-move from 5600 is still to materialise, the US fiscal cliff a possible architect. Should US political commentary improve though, progress could still be made towards 11-month falling highs at 5900.

In FX, the GBP/USD has made a second attempt at the 1.605 level, with the surprise appointment of Marc Carney (Bank of Canada – BoC) as new governor of the Bank of England (BoE) helping Sterling while the dollar weakened on US fiscal cliff concerns. EUR/USD supported by Greek debt solution, testing 1.30 (and late-Oct highs) overnight.

In commodities, Gold trading sideways around $1750 despite weakening of USD. Pause in ascent or rally lost momentum? Brent Crude still in 1-month uptrend on weaker USD with support at $110.5. US Light Crude also higher with support at $87.5.

In focus today will be the UK Final GDP for Q3. After growth of 1.0% in the quarter, the fastest in almost 5 years, the second revision is not seen doing too much damage, however, focus will likely quickly revert to the poor upcoming Q4 reading impacted by reversion to normality following the summer of sport.

Later in the day, look out for US Durable Goods Orders. While the figures are notoriously volatile, visible in the forecast drop back from last month’s strong growth, the numbers can be a real market mover. US Housing is seen growing again in September, as consumer confidence remains buoyant, and a reading of the latter is seen improving as confirmation.

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

• China               Industrial Profits                     Improved
• Japan               Small Business Confidence     Deteriorated
• Germany         Import price Index                  Less Inflationary
• Swiss                UBS Consumption Indicator    Improved
• See Live Macro calendar for all details

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

• Xstrata’s Antapaccay dispatches first copper production
• Falkland Oil and Gas to abandon well 31/12-01
• Subsea 7 wins $360m Shell contract
• Abbott’s Humira wins EU approval for new use
• Kcom Group Plc H1 pretax profit rises
• Acquisitions push Greencore FY profit 37% higher
• De La Rue H1 profit up despite contract delays
• Mitchells and Butlers like-for-like sales broadly flat in the first 8 weeks of FY 2013
• Britvic profit hit by costly Fruit Shoot recall
• Chemring brands its 2012 ‘extremely disappointing’
• Greencore year earnings up 71%
• Severn Trent says in line for full-year forecasts
• Topps Tiles full-year adjusted pretax profit falls
• AZ Electronic agrees licensing deal with William Marsh
• Standard Life in £500m subordinated debt issue
• Cookson says David Egan to become FD of Alent