FTSE preview: Shares flat ahead of US jobs

By Reuters
Updated: 03:10 EDT, 8 October 2010

The FTSE 100 is seen opening flat to slightly higher on Friday, with trading likely to be muted ahead of a US monthly jobs report that could determine the Federal Reserve's next step.

Friday feeling: London shares will take their lead from US economy data.

The UK blue chip index looks set to open flat to up 2 points, according to financial bookmakers, after it closed 19.26 points, or 0.3% lower at 5,662.13 on Thursday.

US stocks ended mixed on Thursday, and in extended trade US aluminium producer Alcoa Inc rose 3.2% after kicking off the unofficial start to earnings season after the closing bell. It reported a lower third-quarter profit, but said global markets were strengthening.

The dollar came under pressure again on Friday, starting to lose gains its made from a bout of profit-taking to adjust positions ahead of the US jobs data and Group of Seven (G7) and IMF meetings later in the week.

On the domestic macroeconomic front, UK producer price index data is scheduled for release.

But investors' main focus will be on September US non-farm payrolls, likely unchanged as a further unwinding of temporary Census jobs and layoffs at state and local governments offset a slight pickup in private hiring.

But the release has bigger implications for a market hoping that weak data will spur the Fed to take further steps to boost the economy.

RSA Insurance gained late on Thursday on talk that Aviva might turn the tables on it and launch a cash offer for it, the Daily Mail market report said.

The head of Potash Corp went on the offensive against its unwanted suitor on Thursday, confidently describing BHP Billiton's $130-a-share hostile bid as 'non-starter' even though a competing offer has yet to emerge.

BP plans to shake up its trading division, the world's largest oil trader, to combat falling profitability and focus on faster-growing emerging markets where the company is less active, the Financial Times said.

US regulators have ordered HSBC to overhaul its internal controls in the United States after an investigation found its compliance programmes created 'a significant potential for unreported money laundering or terrorist financing', the Financial Times said.

Member of Abu Dhabi's royal family Sheikh Mansour bin Sayed al-Nahyan has effectively sold his remaining stake in Barclays, exercising warrants worth £140m, the Daily Telegraph said.

IRC Ltd, the non-precious metals unit of London listed gold miner Petropavlovsk, has cut the size of its Hong Kong initial public offering by half to $249m, according to a term sheet obtained by Reuters.