Pre Market 07:15 Update
UK futures point to a slightly weaker UK open signaling a 13 point drop to 5577 : this is a significant improvement over the 60 point drop as futures opened last night
The lower trendline around 5530 seems a key decision area which had been tested and supported over the past week: it does look like this may hold despite the gloomy lockdown news announced on Saturday: last week's precipitous sell-off into month end may well have been signalling the market expectation of this so it could be another "sell the rumour and buy the news" event. Many FTSE 250 companies should sell-off as the domestic economy gets discounted for the effects of Lockdown 2.0 with hospitality, travel and non essential retail affected most. The potential for an extended lockdown period into Q1 2021 will reinvigorate the Covid trade.
Chinese PMI data overnight helped lift Asia while the CBOE VIX remains around 38, Brent has gapped lower to the $36 level while the Fear and Greed Index has dropped to 30 signalling a more cautious outlook as we enter what may be a very volatile week with the US election and a slew of macro economic data. Gold is stirring from last week's drop sitting around the $1882 at pixel and looking set for a renewed move north as safe havens are sought.
20 companies report today including potential market movers OCDO, HSX and HWDN
The FTSE 100 and 250 are both at key levels with the meg cap index challenging the lower trendline in a channel what has held since June: loss of the level around 5520 and a dip to 5500 may see 5400 and lower revisited. This trend line has held for the two tests seen this week so its continue resilience maye well be indicative of prevailing sentiment for the short to medium term
