London pre-open: Stocks seen higher as Brexit concerns put aside
London stocks were expected to open higher on Wednesday following positive US and Asian sessions as investors put concerns about Brexit aside, at least for now.
The FTSE 100 was set to open 64 points higher than Tuesday’s close at 6,204.
CMC Markets’ Michael Hewson said: “With no likelihood of Article 50 of the Lisbon Treaty getting triggered any time soon it seems that the status quo isn’t likely to change in the short term, with an emergency EU Summit scheduled in September being pencilled in for a new UK Prime Minister to submit plans for next steps.
“Whilst that doesn’t remove the uncertainty with respect to the eventual outcome it also means that markets are going to have plenty of time to settle into their new found reality and equilibrium, as the extra time allotted could well see cooler heads prevail as some of the temperature is taken out of what still remains quite a tense situation. It may well become clearer later today who intends to enter the race to succeed outgoing PM David Cameron with Boris Johnson and Theresa May likely to throw their hats into the ring.”
On the data front, UK net consumer credit and mortgage approvals are at 0930 BST. In the US, personal income and spending is at 1330 BST while pending home sales are at 1500 BST.
Distribution company Bunzl said group revenue for the half year is expected to have increased by 9% at actual exchange rates and 6% at constant rates, largely due to the impact of acquisitions.
“Consistent with the trends seen during the second half of 2015, underlying revenue in the first half of 2016 is expected to be at a similar level to the prior year,” Bunzl said.
Bunzl added that it had purchased two further businesses in the UK and Belgium, The Classic Printed Bag Company Limited, based in Christchurch, England which makes of bespoke retail packaging for non-food retailers in the UK, Hong Kong and elsewhere in Europe and Polaris Chemicals SPRL, a distributor of cleaning and hygiene supplies based near Brussels.
Passenger transport operator Stagecoach posted final results for the year to 30 April on Wednesday, with adjusted earnings per share rising 3.7% to 27.7p.
The FTSE 250 firm saw revenue of £3.87bn during the period, up from £3.2bn, with profit before tax rising marginally to £187.4m from £185m.
“These are a solid set of results, with further revenue and underlying profit growth,” commented chief executive Martin Griffiths.
Stagecoach confirmed an 8.6% rise in dividends to 11.4p per share, from 10.5p per share last year.
Profits rose 17% in the year to April at Dixons Carphone, which delivered an optimistic appraisal of its chances post-Brexit as the largest player in the UK market.
Revenue was down 0.1% to £9.74bn due to a continued slimming down of the UK store estate since the 2014 merger, while like-for-like revenues grew 5% thanks to strong growth in the UK & Ireland, Nordic and Greek businesses.