London pre-open: Little change expected on FTSE ahead of opening bell
UK stocks are expected to kick-off Tuesday’s session with limited gains as investors await direction ahead of what is expected to be another fairly quiet session beyond corporate news.
City sources predict the FTSE 100 will open around five points higher than Monday’s close of 6,611.25.
The economic calendar is looking light both in the UK and abroad, although traders will undoubtedly be looking ahead to data due out from Asia and the Bank of England‘s (BoE) quarterly inflation report.
“Yet again Asian markets will be in focous [on Tuesday] as the majority of economic data is due out of Asia overnight tonight,” said Alpari analyst James Hughes. “Tomorrow sees the release of the BoE inflation report where the fall in inflation and the growth forecasts for the UK will be the major focus.”
He continued: “The inflation issue is not just a problem in the UK as we know, but the continued fall in the headline CPI figure will be a cause for concern for Mark Carney and the BoE.
“Then there will also be the stagnant average earnings number, this is the figure interest rate decisions are now based on and it seems very much like this stubbornly low number will stop a rate hike for at least another nine months.”
In company news, interim results from Vodafone showed evidence of growing stabilisation in its European markets, with earnings guidance for the full year now guided towards the higher end of expectations. Revenues in the six months to 30 September rose 8.9% to £20.8bn, marginally ahead of forecast, with organic service revenue growth in the second quarter down 1.5%, better than the 2.6% fall forecast and much improved on the 4.2% fall in the first quarter.
Building materials group CRH saw a severe slowdown in growth in the third quarter as like-for-like (LFL) sales in Europe slipped, but said it still expects profits to grow around 10% this year. LFL sales across the group increased by 3% in the three months to September, down from 5% in the first half, as 6% LFL growth in the Americas regions was partly offset by a 2% LFL fall in Europe.
Housebuilding and construction group Galliford Try has announced that its infrastructure business has been appointed by the Highways Agency to its collaborative delivery framework. The group is one of six contractors due to deliver works worth a total of up to £1.15bn over the five-year duration of the framework.