London pre-open: Stocks seen muted ahead of GDP, FOMC
London stocks were set for a muted open on Wednesday as investors eyed the release of UK gross domestic product data and a policy announcement from the Federal Reserve.
The FTSE 100 was expected to open two points higher at 7,436.
The first estimate of second-quarter UK GDP is due at 0930 BST, while the Fed's rate announcement is at 1900 BST.
Oanda analyst Craig Erlam said: "A positive surprise on the GDP report could be what the pound needs to finally break significantly above 1.30 against the dollar, with the pair once again struggling to make any serious move above here.
"Another factor here today will be the FOMC decision later, or more likely the statement that accompanies it. The Fed is unlikely to raise interest rates again today having just done so in June, but we could get some insight into whether it will start reducing its balance sheet from September. The Fed has been discussing this for some months now and it may use today’s statement to warn markets ahead of the next meeting."
In corporate news, ITV upped its interim dividend as a show of confidence in the underlying business as first-half profits fell 8%, with a decline in advertising sales joined by fall in production profits due to higher investment and timing of shows.
On total external revenue down 3% to £1.46bn in the six months to 30 June, adjusted operating profits fell 8% to £403m and adjusted earnings per share dropped 9% at 7.7p.
Retail property developer Hammerson reported a rise in first half pre-tax profits of £289.7m from £167.2m boosted by record leasing activity and positive capital value growth helped by high-growth markets in Ireland and premium outlets.
It also warned that UK retailers were experiencing cost pressures from sterling weakness, adjustments to business rates and higher minimum wages.
It was a busy start to the year for 3i Group, it reported on Wednesday, with a net asset value per share of 628p and total return of 4.1% as at 30 June.
The company reported a “good level” of new investment in its private equity division during the first quarter, with £276m invested in Hans Anders and Lampenwelt and a further £241m committed to Formel D and Cirtec.
It also successfully closed two new infrastructure funds in the period - the 3i Managed Infrastructure Acquisitions Fund and the 3i European Operational Projects Fund.