London pre-open: FTSE poised for slightly higher start

London stocks were expected to open in the black on Tuesday, rebounding from the previous session’s losses.

The FTSE 100 was set to open 10 points firmer than Monday’s close at 6,720.

On the data front, BBA loans for house purchases data is at 0930 BST. In the US, S&P/Case-Shiller home prices are at 1400 BST and Markit services PMI is at 1445 BST.

Also this week, investors will be eyeing rate announcements from the Federal Reserve and the Bank of Japan.

CMC Markets’ Michael Hewson said: “A slide in oil prices to three month lows saw US stock markets slide back from their record highs yesterday, and with the US dollar index hitting its highest levels since March, there seems to be an expectation that perhaps this week’s Federal Reserve rate meeting could well come across as slightly more hawkish than markets were pricing a week ago.

“While the odds of an autumn rate rise still remain quite slim the fact remains that the percentage odds of a move on rates in the months from September until the year end haven’t shifted that much since the 13th June. Given recent data this would appear to suggest that the balance of probabilities for a move by the end of the year has shifted somewhat towards the upside, and that markets could be becoming complacent about it.”

In corporate news, BP reported an unchanged dividend as it reduced the level of statutory losses for the first six months of the year and said it was drawing a line under the liabilities for the Deepwater Horizon oil disaster at $61.6bn.

An underlying replacement cost profit of $720m in the three moths to the end of June was down 45% from the same period last year, while at the reported level the loss before tax of $3.38bn for the second quarter was less than half its comparative from 2015 and the $4.24bn loss for the first half of the year was an improvement from $6.34bn last year.

BT Group's infrastructure arm Openreach should be forced to become a distinct company with its own board, own staff and separate branding to give it independence from the larger group, a report from regular Ofcom declared on Tuesday.

As a legally separate company within BT Group, with its own ‘articles of association’ and a majority of independent directors who are not appointed by or connected to BT, the company would be obliged to consult formally with customers such as Sky and TalkTalk on large-scale investments.

Mondi Group updated the market on its earnings expectations for the six months ended 30 June on Tuesday morning, ahead of the release of its results for the half-year on 4 August.

The FTSE 100 firm said it anticipates basic underlying earnings per share of 73 to 77 euro cents, up from 67.8 cents a year ago, and basic earnings per share of the same 73 to 77 cent range, well up from 60.3 cents last year

Mondi said basic headline earnings per share should also fall within the same range, compared with 60.1 cents in the comparative period.