Market overview: Bid speculation lifts Tullow Oil

1133: Some reports are citing the FT Alphaville as commenting on speculation that Royal Dutch might make a bid for smaller rival Tullow Oil.

1132: Shares in Spanish telecommunications outfit Telefonica are falling by over 2% on a report in the El Confidencial website that the firm may be looking to soon carry out a €5bn capital increase.

1122: Shares in RyanAir are registering a sharp drop and in turn weighing on easyJet following the company's third quarter results. Management has flagged likely pricing pressures as a result of lower fuel prices, has seen some pricing softness in January and expects modest profit growth in 2016. Analysts at Liberum believe the company is trying to manage analysts' expectations in the wake of the drop in fuel prices. The broker points out how the above has not stopped management from declaring a new €400 share buyback program.

1009: New Greek Prime Minister Tspiras has confirmed his country has entered into talks with the European Union.

0930: Suvery compiler Markit’s manufacturing sector PMI for the UK improved to 53 points from last month’s reading of 52.7 (consensus: 52.7).

0900: Markit’s Eurozone manufacturing sector PMI has printed at 51, the same as last month and in-line with forecasts. Acting as a backdrop, Deutsche Bank has raised its 2015 GDP outlook to 1.3% from 1%, citing a weaker euro and lower oil prices.

0845: The official Chinese manufacturing sector purchasing managers’ index (PMI) for the month of January fell to a reading of 49.8 from 50.1 in the month before (consensus: 50.2). That was the fourth consecutive month of declines, with the PMI settling at a September 2012 low. Markit’s own manufacturing sector PMI was also revised a tad lower this morning, to 49.7 from 49.8. “Both manufacturing surveys suggest there has been a slight deterioration in China’s export conditions in January.”

0830: Stocks have begun the morning higher despite a small dip shortly after the open. That comes despite slightly weaker than expected readings on China’s manufacturing sector overnight. CRH is in the lead at the start of trading after agreeing to purchase assets from continental rivals Holcim and Lafarge. Out on the FTSE 250 the biggest gains are to be seen in the oil patch following a snap back in US crude futures Friday evening on signs that the country’s highest cost producers have been sharply reducing their investments. FTSE 100 up 30 points to 6,780.47.