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On Monday, UK stocks slightly decreased as investors approached the domestic budget with caution, despite the limiting effect of BP's oil firm on further declines. The FTSE 100 index, which represents the top-performing companies in the UK, dropped by 0.6%. Although indications of decreasing inflation have maintained positive investor sentiment, attention will shift to Finance Minister Jeremy Hunt's unveiling of the pre-election budget on Wednesday to gauge potential tax reductions and the state of the economy.

DS Smith, a packaging group in the UK, saw a 1.6% increase in its shares, reaching 331.7p, following reports of a higher bid from rival company Mondi PLC. This news comes after Mondi had previously confirmed talks of a potential takeover to create a $13 billion UK paper giant. As a result of these reports, DS Smith's shares rose by 6.22%, while Mondi's shares have decreased by 8.11% year-to-date. Endeavour Mining and Fresnillo shares benefited from the continued bid in the precious metals market with Gold and new two month highs above 2100 the rise led Endeavour to the top spot on the blue chip index with gains of 3.32% on the day.

Sticking with the commodity story Oil prices increased on Monday as OPEC+ members decided to prolong voluntary oil output cuts of 2.2 million barrels per day into the second quarter, in line with market expectations. BP's stock price surged after Jefferies upgraded its rating from 'hold' to 'buy' and raised the price target to 570p from 520p. The bank anticipates that the company will narrow the valuation gap compared to its peers due to its increased focus on distributions, reduced capex risk, and relatively conservative consensus earnings growth expectations. Jefferies also highlighted BP's improved financial position, including a higher allocation of free cash flow to shareholder distributions, enhanced visibility for its buyback program, and tightened capex guidance following its fourth-quarter results.

On the negative side of the ledger Ocado, a British online grocery retailer, faced pressure once again after releasing its financial results last week. The company is also facing the possibility of a legal dispute with Marks & Spencer, a major UK retailer. This has added to the challenges that Ocado is currently dealing with.

FTSE Bias: Bullish Above Bearish below 7650

• Below  7590 opens 7550
• Primary support 7450
• Primary objective 7768
• 5 Day VWAP bearish
• 20 Day VWAP bearish

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