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

UK 100 Index called to open -35pts at 6360, having retreated from a brief encounter with 6400 amid a teasing test of 6-month falling resistance which we are comfortably back below. On the bullish front we have broken and remain above the 100-day MA which could prove supportive in engineering a more meaningful breakout. While long-term resistance may have prevailed overnight, we remain in an uptrend from August lows. Watch levels: Bullish 6405, Bearish 6345.

The negative opening call comes after a down day in Asia with Chinese equities -5% after data showing Chinese Industrial Profits growth contracted sharply in October adding to worries about a hard economic landing while some big brokerages announced regulatory probes, some companies disclosed debt repayment problems and there was talk of the nation’s currency getting a lower than hoped for weighting in the IMF’s reserve currency basket.

Japan’s Nikkei declines being led by Airlines after broker downgrades and despite commodities producers rallying on hopes of China intervening to prop up its domestic metals industry, which has kept metals prices off their lows. While Japan’s Jobless data improved, inflation showed need for continued BoJ stimulus. Australia’s ASX is the regional outperformer only just in the red thanks to AUD weakness boosting the productivity of exporters and hopes of further gains for industrial materials.

Geopolitics still very much to the fore with Turkey demanding a Russian apology while the latter retaliates with restrictions on travel  and goods. Note France still rallying support for coordinated strikes against ISIS ahead of the Global climate change meeting in Paris next week, although Belgium now off high alert.  However sentiment still buoyed by the prospect of more ECB stimulus next week offsetting the Fed rate hike mid-month.

US markets were closed for Thanksgiving yesterday with few traders likely to garner the permission of spouses to return to work for today’s half-day. Note US turkey & yam inventories at 12-month lows. Note also the USD Index struggling to do much better than the 100 mark. Is the Fed rate rise priced in. Retrace to give commodities a lift?

In focus today after a raft of disappointing overnight data (China Industrial Profits missed, German Import Price deflation worsened,  UK Consumer Confidence dipped and UK House Price growth slowed) we have UK GDP seen solid. Thereafter, French Consumer Spending is expected down in October even before a surely terrorism-impacted November, while Spanish CPI and French PPI seen signalling need for more ECB stimulus. Eurozone sentiment data seen unchanged November

The recurring theme of China slowdown has given crude oil further cause to retrace the gains of Wednesday with WTI having traded through Thursday’s watch level and rising support line $42.50; eyeing $42.25 this morning. Brent, meanwhile, tested $45 yesterday afternoon and remains under pressure with $44.90 and $44.65 potential targets as we move into Friday. Lower volume, Chinese demand concerns, global oversupply leave the outlook bearish in the near term. Look out for throw-away Saudi commentary though.

Gold did indeed break out of its narrowing pattern, which now looks more like a descending triangle or pennant – both seen to be continuation patterns. With the preceding trend being southerly in nature, perhaps a welcome weekend break is just what Gold needs right now. It’s just hard not to think it’ll be a break-down. This can of course be traded – bears looking for a revisit of multi-year lows $1064 while $1100 surely the level to beat for the bulls.

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

• Lamprell says on track to deliver 2015 results in line with guidance
• Rightster Group ends review, to seek further investment
• Volex says appoints Nathaniel rothschild as executive chairman
• Bacanora Minerals appoints Mark Hohnen as director
• Forseke to step down as Alliance Trust chair
• Pennon Group says H1 pretax profit rises 7%
• Goals Soccer Centres appoints Nick Basing as deputy chairman
• Anglo American to shut Drayton coal mine in Australia
• Lombard Risk names Alistair Brown as CEO
• Balfour Beatty awarded £104mn road scheme
• VG Capital says NAV of 606 pence for 3 months to 31 Oct