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

UK 100 called to open +5pts, with Asian markets boosted by improved sentiment in Europe (Italian debt auction; Spanish GDP; earnings reports; Greece nearly there?) and a good run of macro data overnight. US markets were still closed last night after Hurricane Sandy, but are expected to reopen today (some macro data/earnings delayed).

Japan outperforming thanks to some strong data and unusual joint statement by Bank of Japan (BoJ) and government to commit to reduce deflation, seeing a return of risk appetite this following the lukewarm reception yesterday to the former’s planned increase in asset purchases.

Overnight data mostly strong but Japan’s PMI Manufacturing did fall at its fastest in 18 months and UK Consumer confidence dipped to a 6-month low. Elsewhere, Australian Building Approvals and Private Sector Credit were stronger than expected; Japanese Housing was a touch weaker. German Retail Sales have come out better on the month, but worse on the year. French Consumer Spending was worse, and Producer Prices were better, but are also inflationary.

In Europe, there is speculation (not worthy of an upgrade yet until news official) that Greece has made more progress regarding budget cuts/austerity packages in order to secure next tranche of bailout aid. German Chancellor Merkel and IMF head Lagarde stated global economy fragile with uncertain prospects, based on debt levels in major nations being unsustainable, and Eurozone needs reforms.

US markets expected to up and running again today, although be prepared for teething problems given the impact of significant power outages, transport disruption and potential issues with data feeds. Contingency plans are being tested to the max.

The UK flagship index regained the 5840 level we spoke of yesterday, although progress  above was limited. Return of US could add some more spice to trading activity after low volumes and caution so far this week. Trading since yesterday midday flat could mean pause before another leg up. Rising support 5800, then recent low 5750. Resistance at prior highs 5920-30.

In FX, GBP/USD slowed up before 1.61 after bounce from 1.60. New higher low could spark end of 1-month downtrend, but falling trendline at 1.61 yet to be broken. EUR/USD still struggling with 2-week falling resistance, falling back from the trendline and yesterday’s highs of 1.298.

In commodities, Gold trading sideways, but broken out from falling trendline of resistance since 5 Oct. Tentative rising lows? US Crude Oil still depressed, but off lows of $85 and testing last few days’ highs of $86. Beware continued assessment of US refining infrastructure following Hurricane. Brent Crude rebounded overnight as USD weakened, but 1-week resistance at $110 remains.

Q3 results out this morning from Spanish Bank BBVA look better than expected, Barclays adjusted net earnings looks in-line, Steel giant Arcelor Mittal was worse (proposed dividend cut) while German airline Lufthansa was better.

Today’s focus will be on the return of the US to trading following the Hurricane. Data-wise things will be limited to Eurozone consumer inflation (CPI) which is seen cooling, but remains a worry with austerity and rising prices a burden on the region and the ECB not really in a position to raise rates to combat. Eurozone unemployment seen rising a touch. US Chicago PMI seen improving back to growth.

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

• Japan               Manufacturing PMI                Worse
• UK                    Consumer Confidence                        Worse
• Aussie              Building Approvals                  Better
• Aussie              Private Sector Credit              Better
• Japan               Labour Cash Earnings             Better
• Japan               Construction Orders               Growth slowed
• Japan               Housing Starts                         Worse
• Germany         Retail Sales                             Mixed
• France             Consumer Spending                Worse
• France             Producer Prices                       Better, but inflationary
• See Live Macro calendar for all details

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

• A.G. Barr, Britvic extend merger talks
• Next Fifteen Comms discovers internal fraud
• Next nudges profit outlook higher
• Standard Life 9-month sales down 7 percent
• Stagecoach buys Wigan bus operations
• Mondi says Q3 underlying operating profit at EUR135 million
• Afren says Okoro field extension starts production
• St. James’s Place outpaces slow market with sales
• Phoenix Group says on track for targets
• Antofagasta Q3 copper production climbs, on track for 2012 target
• Essar Energy wins approval to clear forest on coal block
• Vodafone completes Telstraclear acquisition