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

UK 100 called to open +15pts helped by US markets (S&P, DJIA) posting another record close and Asian markets benefiting from better than expected Chinese Trade data, with the trade balance, exports and imports suggesting strong domestic and foreign demand, appeasing some of the concerns of late surrounding growth in the world’s #2 economy.

To counter good China data, ratings agency Moody’s suggested the outlook for the Chinese property market is stable but sales growth will slow, and it would change its outlook to negative if the government imposes and more restrictions to combat the overheating.

After the RBA’s surprise rate cut yesterday dented AUD, the commodity currency recovered some of its losses and it was the turn of neighbour New Zealand to announce it had sold NZD and is capable of further intervention to counter its overvalued currency.

Staying with central banks, the ECB’s Asmussen reiterated Draghi’s comments that the bank is ready to act if necessary, but tempering things with a warning on rates staying too low for too long.

In the US, markets helped by Treasury Secretary Lew said the US economy was showing signs of improvement and should be growing 3%+ next year, pointing to fiscal tensions as Washington manufactured with nobody wanting a debt limit showdown.

US sentiment also helped by positive European close (DAX record), buoyed by a successful return of Portugal to the long-term debt markets, better German Factory orders and Australia’s rate cut topping up the central bank punch bowl and boosting risk appetite.

In focus today will be the German Industrial Production for March which consensus expects to be weaker than February, but following the much stronger Factory Orders yesterday traders are hoping for an upside surprise from the Eurozone’s workhorse to help sustain the recent market rally amid a quiet macro data calendar.

UK 100 broken out above 1-month highs with the retracement of the March sell-off completed and further ground gained as traders continue to push equities higher. Note major bourses in the US and Europe at or very near all-time highs. The UK index has some work to do, but is there an element of catch-up to come? Oct 2007 highs of 6770 on the cards?

In FX, GBP/USD off its recent highs of 1.56, and breaking below support at 1.55 as the USD was helped by the Australian rate cut and expectations of more ECB intervention. EUR/USD still trading around 1.31, with support possible around 1.305 from stronger German data. While expectations of any more rate cuts could hamper further gains, there is the competing element of the ECB’s ‘ready-to act’ comment which may boost recovery optimism.

Gold bounced off lows of $1440 and remains in $1440-1480 range as some optimism on global situation hampers demand for the safehaven, as well as receding fears of unconventional momentary policy fuelling inflation which requires a hedge.

Oils trading in narrow range near recent highs keeping May and 1-month rally alive, with a rebound overnight thanks to Chinese data. US Light Crude back up above $96, with support at $95 and resistance possible at recent highs $97. Brent Crude back up above $104, but still in $103.5-105 range.

For any help you may require placing trades or in terms of market information, put a call in to our trading floor – all part of the service.

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

• UK                    BRC Sales                                Worse
• China               Trade Balance                                     Better
• China               Imports                                    Better
• China               Exports                                    Better
• See Live Macro calendar for all details

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

• ·         J D Wetherspoon Q3 sales up 6.3 pct
• InterContinental Hotels posts 3.1 pct global Q1 RevPAR growth
• Dechra Pharmaceuticals says on track despite Q3 slowdown
• Galliford Try says housing market picking up, prices above expectations
• Providence says proceeds with talks to attract partner
• CSR beats own view with 5 pct Q1 revenue rise
• GVC says trading in line
• CRH sees earnings growth in H2 as U.S. offsets weaker Europe
• Sainsbury beats full-year forecasts
• Rightmove confident on full year
• Next quarterly sales edge higher
• ViaLogy wins contract with Gente Oil in Ecuador
• BAE Systems outlook unchanged, sees modest EPS growth
• Intu Properties – Mall footfall 1 pct down
• Playtech says trading since March strong
• Costain says year starts strongly
• Sage Group first-half profit rises 6 pct
• Petra Diamonds qtrly production rises 4 pct
• Workspace gets planning permission for Tower Bridge project
• Promethean World Q1 sales drop 22.5 pct
• Melrose Industries says trading in line with expectations
• Drax maintains full year estimates