London pre-open: FTSE awaits direction ahead of data-heavy day
Little change is expected at Tuesday's opening bell as investors await direction from the numerous pieces of economic data due out both at home and across the Channel.
FTSE 100
8,078.86
17:14 25/04/24
NATWEST GROUP
289.80p
16:39 25/04/24
Next
9,104.00p
16:45 25/04/24
City sources predict the FTSE 100 will open around three points higher than Monday's close of 6,646.60.
Asian markets were knocked lower overnight by the continued protests in Hong Kong SAR, while US indices also finished in the red, albeit off their intra-day lows.
Economic data out overnight will not offer much succor either. The HSBC Chinese manufacturing sector purchasing managers' index for September was revised lower, revealing a print of 50.2 versus the preliminary estimate of 50.5.
Japan's industrial production dropped by 1.5% month-on-month in August, quite a bit worse than forecast.
As of 07:50 the Hang Seng was trading lower by 280.19 points to 22,949.02.
Investors will on Tuesday first be looking to retail and unemployment data from Germany for some encouraging news, while at 09:30 the UK will release its latest second quarter GDP reading, which is predicted to show that at 3.2% growth was actually slightly higher than first anticipated.
"Numbers from Europe’s biggest economy [Germany] have been poor of late and a turnaround in fortunes would be greatly appreciated by Mario Draghi, especially in a week were the European Central Bank could potentially add a full programme of QE to tackle the mess that is the European economy," said Alpari market analyst James Hughes.
He continued: "Mark Carney and the Bank of England (BoE) have already mentioned a number of times that the growth situation in the UK is not one that is a concern and if today’s numbers are correct we can see why [...] This yet again highlights the stance of the government and BoE, and will leave them to focus, like many other central banks on tier obsession with hiking interest rates and as has been previously stated it is the average earnings figure that is causing the biggest concern here."
Also due to be released is the Eurozone consumer price index reading.
In company news, clothes retailer Next warned that third quarter sales were lower than its previous expectations and a continuation of the cold weather could reduce full year profits. However, the FTSE 100 group was confident enough to maintain its full year guidance, saying "our experience suggests that some lost sales are regained when the weather turns".
London property group Workspace has sold the first phase of its redeveloped Poplar Business Park site to Telford Homes. The redevelopment comprises 170 apartments and 8,000 square foot of light industrial space.
Majority state-owned lender Royal Bank of Scotland (RBS) now expects to “significantly” outperform its previous guidance of approximately £1bn in total impairments for the fiscal year 2014 thanks to a strong operating performance by RBS Capital Resolution and a continued improvement in economic conditions and asset prices, including Ireland.