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

UK 100 called to open flat, but still in 1-week uptrend, with Asian equities failing to surrender the markets’ ‘risk-on’ mood of yesterday. Sentiment boosted overnight by news that Moody’s had concluded its review of Spain’s sovereign credit rating, reaffirming it at investment grade (albeit just above, and still with a negative outlook) when many had feared that a downgrade to non-investment grade was on the way. The ratings agency’s decision was based on the European Central Bank’s (ECB) willingness to intervene and the nation’s on-going reforms/restructuring.

While this removes some overhang (we’ve been waiting for a few months now) does this take us any near Spain asking for help (even if it doesn’t use it)? Does Spain need to? Markets already pricing in lower borrowing costs in a similar reaction to when the ECB gave its pledge to help if needed. The waiting may continue until the results of regional elections over the next 6 weeks.

Asia also boosted by hopes of more monetary easing from Japan and China, however, China is the laggard ahead of the deluge of data tomorrow including Q3 GDP. Sentiment also unaffected by Intel and IBM results (after US close) beating expectations but still showing slowing growth and giving an outlook which failed to inspire.

US markets closed up, helped by US earnings and talk that German lawmakers open to Spain being given a credit line which would be considered a pre-condition and trigger for ECB to step in to the sovereign bond markets as necessary, although this was later denied  as relating specifically to Spain.

Macro data from the US also pleased, keeping that momentum story alive, with inflation, industrial production and housing supporting the positive data run of late. Markets almost unaffected by news that Citigroup’s CEO resigned, with its shares closing higher on the day. We also had positive Q3 results from Coca Cola, UnitedHealth, State Street, Goldman Sachs, Johnson & Johnson.

This morning we see mining major Xstrata reporting Q3 copper production dipping 16% year-on-year, likely hindered by a slowing Chinese economy.

In FX, the EUR has been helped by Moody’s maintaining Spain’s investment grade status, with EUR/USD testing 1.312. GBP/USD maintained 1-week rally to 1.614. In commodities, Gold still rising from its lows of two days – Silver following suit.  Gains in US Crude Oil curtailed around $92.5. Brent also slowed up before $115 after recent gains on supply fears.

Today’s focus will be on the Bank of England (BoE) minutes from the most recent monetary policy meeting. The votes are expected unchanged but the minutes could provide colour on the committee’s thinking on rates and monetary easing. UK unemployment seen unchanged. Eurozone construction output likely to show more contraction with region hit by austerity. US housing always watched as consumer sentiment gauge. More US Q3 results today from the likes of Blackrock and Bank of America.

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

• Aussie              Westpac Leading Index                       Growth
• Japan               Machine Tool Orders                          Continued decline
• See Live Macro calendar for all details

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

• Speedy Hire says confident of meeting its FY expectations
• Cable & Wireless Comms confirms Macau talks
• International Personal Finance Q3 profit in line with last year
• ReNeuron announces stroke clinical trial progress
• 888 expects FY earnings to beat market expectations
• Shanta Gold to raise at least $30 million
• Xstrata says Q3 copper production dips
• RBS to exit Asset Protection Scheme on Thursday
• Polymetal ups 2012 output guidance to 1.1 mln ounces