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

UK 100 Index called to open +25pts at 7235, a fresh record that builds on Friday’s record high close. Rising lows since mid-December remain valid while a 9-month bullish inverse H&S pattern that kicked off last July with a breakout at 6400 and worth 900pts still has upside potential. Bulls will likely want to see a break above 7250 to be sure the uptrend is alive and well. Bears probably need to see Friday’s breakout at 7215 give way. Watch levels: Bullish 7250, Bearish 7215.

Calls for a positive start come thanks to US bourses pushing higher on Friday (the US Dow Jones coming within a whisker of the fabled 20,000 mark) and a positive session in Asia overnight despite Japan’s holiday absence. The Santa rally has morphed into the January effect to keep the uptrend alive towards Trump’s inauguration and what would appear to be a new

US optimism not hampered by a bullish statement from the Fed’s Williams saying the nation doesn’t need Trump’s short-term fiscal boost given it is already at full employment and inflation is closing in on the Federal Reserve’s target which might merely speed up necessary rate rises. While this strengthened the USD, UK PM May’s Hard Brexit rhetoric (ditch single market) in a Sky interview also gave Sterling  kick, something that flatters the value of international UK Index profits.

With Japan’s Nikkei closed for Coming of Age day the positive lead from Asia derives from Australia’s ASX which is outperforming thanks to positive construction and building approvals data coupled with buoyancy in the key metals space in spite of USD strength. The latter is linked to expectations of a demand pickup in both China and the US however Miners are weak overnight the index getting help from financials. Equities in China and Hong Kong also higher.

It was close but no cigar for the Dow Jones despite reaching a fresh all-time high as the index a single point of 20,000 during Friday’s trading only to pull back into the close. An eventual +0.3% finish at 19,964 points led once again by Goldman Sachs will not be what bulls would have hoped for given the proximity of 20k, while its counterpart S&P 500 closed at an all-time high (+0.4%) thanks to a strong performance from the Tech sector which saw the Nasdaq (+0.6%) outperform its peers.

Crude Oil prices have fallen from Friday’s highs however remain supported above last week’s lows as OPEC members continue to report compliance with regards to November’s production cut deal. A 10th straight weekly increase in the Baker Hughes rig count reading could implies a pickup in US production in the light of improving oil prices, although the magnitude of which is not yet known.

Gold is off its worst levels of Friday, holding its rebound from last month’s 2016 lows, however still down from Thursday’s peak hindered by positive US economic data pushing the greenback higher. The surging dollar remains a hindrance for the recovering price of the precious metal as investors eye the possibility of Fed rate hikes throughout the course of 2017.

In focus today will be UK Halifax House Price data which is seen holding its ground to the benefit of the housebuilders which already got a boost past week from Persimmon’s positive trading update and several broker upgrades.

Thereafter it’s limited to Italian Unemployment which  is certain to remain stubbornly high although the Eurozone’s own print may improve a touch and the region’s Sentix Investor Sentiment should have gained ground. After William’s comments listen out for what the Fed’s Rosengren and Lockhart have to say this afternoon.

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

• Britain’s William Hill reports profit at bottom of guidance range
• Petrofac Secures $600Mln EPC Contract in Oman
• Britain sells further 1 percent of Lloyds shares
• Gold edges up, but gains limited by rate hike prospects
• Centamin announces 8% decrease in Q4 production; beats expectations
• Ferrexpo announces higher sales volumes for 2016
• Boohoo.com confirms U.S. approval for Nasty Gal assets deal
• Plus500 renews deal with Atlético Madrid football club
• Bovis Homes chief executive steps down after profit warning
• Genel Energy comments on Tawke fields cretaceous discovery
• IG Group says French regulatory changes could enhance competitive position
• Jaguar Land Rover sells record 583,313 cars in 2016
• Oil prices fall as Iran crude tanker exports surge, U.S. adds more rigs
• Amerisur Resources Platanillo-24 Update
• Ferrexpo 2016 Pellets -4%; Strong Global Demand Push Sales Up.