Proactive Investors - UK inflation figures will set the tone on Wednesday with expectations that the headline figure will drop below 5%.
Spread betting companies are calling London’s lead index up by around 28 points.
On Tuesday, cooler than expected US inflation figures sent US markets soaring on expectations that interest rates have peaked.
Andrew Hunter at Capital Economics said the softer data "kills off any remaining chance of a December rate hike from the Fed, and we continue to expect a further decline in inflation over the coming months, which will bring interest rate cuts onto the agenda before long."
Bank of America (NYSE:BAC), which up to this report, had expected one interest rate increase altered its call.
"We have changed our Fed call. We now think that the hiking cycle is over," the bank said.
"The Fed will probably try to leave the door open for more hikes next year at its December meeting, but there are diminishing returns to hawkish rhetoric when its policy choices lean dovish. We think that it would take meaningful re-acceleration in inflation for the Fed to hike next year. That is not our base case.
Back in London, and alongside inflation data, updates from SSE (LON:SSE) and Experian (LSE:EXPN) will provide the early headlines.