London pre-open: All eyes on Yellen, negative bond yields

Markets were expected to tread water at the start of trading on Wednesday, as investors waited on a speech by the chair of the US Federal Reserve, Janet Yellen, later in the day.

Investors would nevertheless be keeping close tabs on crude oil futures and European banking shares, given the toxic mix of late as drops in the former have been by some as the catalyst for losses in the latter.

Against that backdrop, the Footsie was being called to start the session between two to six points lower from Tuesday's close of 5,632.19

In her remarks before the US House Financial Services Committee, analysts were expecting Ms.Yellen to take a nuanced stance, on the one hand admiting the risks to the economy from the recent volatility in markets while avoiding any hint of panic.

Any remarks regarding the potential impact which negative bond yields around the world might have on banks' profitability would be of particular interest after Japanese 10-year government bond yields fell into negative territory on Tuesday for the first time ever since Japan first issued debt, in 1870.

Industrial production figures were set for release in the UK, France and Italy throughout the morning.

Chip-maker sounds confident note

ARM Holdings posted a strong set of full year results and said it was confident of meeting forecasts for 2016 as demand for its microchip technology continues to grow. Despite the profit warning from smaller peer Imagination Technologies earlier this week, ARM's fourth quarter saw a 19% increase in revenue to £269.1m, helping to lift profits 17% to £138.7m.

Greene King has posted a strong third quarter book, boosted by strong Christmas sales. The FTSE 250 pub operator and brewer said on Wednesday that for the 40 weeks to 7 February 2016, Greene King Retail like-for-like sales were up 2.2%, with a 5% increase in sales over the two Christmas weeks. Spirit Managed life-for-like sales also rose 1.1% for the period, with Christmas sales up 5.2%. The company said it achieved record sales of £6.8m on Christmas Day in the combined retail estate, led by food purchases.

Hikma Pharmaceutical's takeover of Roxane Laboratories took on a new shape on Wednesday, with the cash consideration being almost halved off the back of significantly lower revenue projections. The FTSE 100 company had published a prospectus on 22 January in relation to the acquisition, but said it had now received new information on the financial performance of Roxane in 2015.