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

UK 100 called to open -5pts, (-11.9pt impact from ex-dividends) with Asian markets trading lower on renewed concerns over the Eurozone debt crisis and diluted hopes for central bank stimulus.

The FT reports that Greece wants a 2-year extension to its austerity programme, with public spending cuts spared spread over 4 years instead of two, as it struggles to meet targets. Regional fears exacerbated by the possibility that Spain may offer haircuts to retail investors before being repaid in full by banks over time. Clutching at straws? It assumes the banks are around to repay.

On the stimulus front, China’s central bank (Peoples Banks of China; PBOC) may in fact have postponed any cuts in the bank reserve rate requirement (RRR) for longer than expected, with it preferring to use other measures to boost liquidity. After the weak growth data last week, this has increased doubts over a China rebound/soft landing, weighing on global sentiment.

Broadly positive macro data from the US (and Europe) yesterday also contributed to a drop in expectations of further monetary easing by the US Federal Reserve (Fed). That just leaves the European Central Bank (ECB), and it has said it will only move when the countries cry for help.

Overnight, macro data Australia focused, with a fall in consumer confidence (impact of slowing China? Australia very resources-demand focused) but a bigger then expected rise in Wages.

In the Commodities space Gold has rebounded having collapsed yesterday on US data reducing stimulus hopes, regaining the $1,600 level. Oil remains solid, with US Light crude above $93 and Brent Crude at $114, continuing to be helped by supply concerns. In FX, USD stronger vs GBP and EUR on less hops of monetary stimulus (currency devaluing money printing) from the US. EUR stronger vs USD and GBP over last hour. UK data and BoE minutes (see below) could move GBP today.

With stimulus hopes reduced, today’s focus likely on Bank of England (BoE) minutes, especially with the recent quarterly inflation report slashing growth estimates and saying inflation heading south. Yesterday it rose more than expected yesterday (rebound in oil price). BoE and forecasting. Hmmm.

The minutes will be mostly looked to for the decision (what was the vote) to leave monetary policy on hold this month. Was there any increase in pressure to boost stimulus further from the increase July, and following the atrocious -0.7% Q2 preliminary GDP figure? Or did the pair of dissenters hold strong again? Are we to remain hopeful or will they fade like with China and the US?

UK unemployment is seen unchanged, however, any big divergence from consensus could impact sentiment. US consumer inflation is seen pretty stable, along with Empire State Manufacturing and Industrial production.

No corporate results out this morning, but the big news from the financial sector is that Standard Chartered has settled with the state of New York for $340m over allegations it was negligent/facilitated flow of Iranian funds through the US, violating long-running US sanctions. The civil penalty does not quite draw a line under the issue, though, with other regulators likely to pursue investigation.

Note European markets open, but public (religious) holiday across most of the region, adding to the traditional August quiet.

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

• Aussie              Consumer Confidence                        Declined
• Aussie              Wage Costs Index                   Better
• See Live Macro calendar for all details

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

• Shell to restart Singapore refinery crude unit by Sept at
• Insurer Resolution to overhaul board structure
• Balfour Beatty profit rises on infrastructure asset sales
• Standard Chartered reaches $340m settlement over Iran
• Vectura to Record $3M in Revenue Over VR315 License Agreement
• Kea Petroleum Puka 1 Well Tests Encouraging, Flows up to 290 B/D CRH
• Cobham: Orders for IED Detection Exceed GBP13M for 2Q
• Interserve 1H Pretax Profit +8%, Reiterates ‘Stable’ 2012 Performance
• Lookers Posts 9% Rise in 1H Profit, To Raise FY Dividend Payment by 8%
• FirstGroup Awarded New InterCity West Coast Rail Franchise Until 2026
• ENRC To Focus On Cost Control As Profit Falls On Lower Ore Prices
• Petra Diamonds Lowers Fiscal 2013 Carat Production Guidance by 8.8%
• Lloyds Banking Sells Private Equity Investment Portfolio for GBP1.03B
• Europa Oil & Gas Major Increase in Full Year Production and Revenues