The FTSE 100 is ten points higher in mid-morning trading, but weaker European data is putting a dampener on sentiment.

Earnings and hopes of more US-China progress continue to support equities across the globe, despite the somewhat mixed session in Asia overnight. The longer this bounce goes on, the greater the chance that the market moves from ‘high volatility' to ‘relentless grind higher', similar to what we saw in 2017 and the middle of 2018. Earnings season has delivered plenty of reasons to buy equities at the ‘fire-sale' valuations (relatively speaking) that we saw at the end of 2018. Weaker CPI readings yesterday have eased fears that the Fed will find renewed reasons to raise rates, and this more benign policy environment has added fuel to the rebound. The discount sale in AstraZeneca shares is certainly over, with a 4.5% bounce today adding to the existing gains seen since the end of January. A second quarter of growth has won investors round to Pascal Soriot's efforts, and the newer drugs are already doing their bit.

News that Germany barely skirted recession in Q4 has done little to boost the euro, which remains near the three-month lows it hit yesterday. Once again, European stocks are at risk of being left trailing behind the US, but with growth so weak in Europe it is hardly surprising. Brexit and a trade spat with the US cloud the outlook, and it will soon be up to the ECB to rescue the situation.

Ahead of the open, we expect the Dow to start at 25,568, up 25 points on last night's close.

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