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

  UK 100 called to open +20pts at 6510, having bounced from the recent ‘taper-tantrum’ correction and regained an important round number level.

 Asian markets largely positive with Japanese data showing a worsening in the Trade Balance, with exports growing slower than expected (not good for rest of world recovery) and imports by more (consumption still driving growth). Abenomics encountering trouble?

 In focus this week (empty calendar today) will be the UK CBI Industrial Trends which are seen improving, along with Eurozone PMI Manufacturing & Services readings in-line with improved GDP last week. UK Q2 GDP seen confirmed at 0.6% QoQ and 1.4% YoY.

 Elsewhere, markets still looking for more clues on future of US monetary policy. More jobless data, housing and PMI. You have to wonder whether all this ‘taper talk’ is designed by government to scare politicians into a solution for another looming sequester deadline. Surely they wouldn’t dare give up all that consumer confidence which has been building over the last while?

 The UK 100 rebound continued since Friday morning’s lows. Regain of 6500 is a positive and opens possibility of 6490 serving as support on any fall-back, while the abandoned 6560 level which served as both support and resistance over the last 2 weeks could be the next target.

 In FX, GBP/USD solid above 1.56 level with 50% Fibonacci retrace of fall since beginning of year potentially serving as support after the break above the trendline of falling highs and the 200-day MA. EUR/USD off Friday’s 1.338 highs. Potential downside to last week’s lows of 1.32.

 In Commodities, Gold rally above $1350 continues helped by continued weakness in USD (USD index still in downtrend from July) and the level may serve as support on any retrace. Upside possible to $1500 where there is a crossroads of resistance trendlines. Oils still benefiting from supply concerns and Middle Eastern unrest but Brent still winning the race north.

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

• UK            Rightmove House Prices                 Mixed
• JP             Trade Balance                                Worse
• JP             Exports                                            Worse 
• JP             Imports                                           Better
• AU            New Motor Vehicle Sales             Worse
• JP             Sentiment Indices                           Better

See Live Macro calendar for all details

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

• Botswana Diamonds agrees exploration deal with Alrosa
• M+W Group confirms it submitted an indicative offer for Kentz
• Bovis Homes first half profit jumps 50%
• Amlin reports 12% fall in first-half profit
• Kentz says Amec approach undervalued company
• Kingspan CEO sees input costs stable