London pre-open: FTSE to rebound after heavy losses

London stocks were expected to open higher on Tuesday, rebounding from two days of heavy losses as the pound regained a little ground in Asian trade.

The FTSE 100 was set to open 58 points higher than Monday’s close at 6,040.

There are no major UK data due but the third release of first-quarter US GDP is at 1330 BST. S&P Case-Shiller house prices are at 1400 BST, while US consumer confidence is at 1500 BST.

EU leaders are due to meet in Brussels later on Tuesday, so investors will eye any developments from there as the issue of Brexit is likely to be in focus.

CMC Markets’ Michael Hewson said: “Later today Prime Minister David Cameron will be heading to Brussels to attend a meeting of EU leaders in the wake of last week’s vote and while his reception is probably likely to be chilly, there will probably also be some light hearted mentions of last night’s embarrassment on the football fields of France, as England lost to Iceland.

“Yesterday the Prime Minister announced he would not be triggering Article 50 of the Lisbon Treaty, and also ruled out the prospect of another referendum. Given the poisonous nature of the last one, that may be no bad thing. On the other side the EU issued a warning that talks on future relations could not begin until the request had been lodged in what could well turn out to be a cross channel staring contest.”

In corporate news, AstraZeneca has won European regulatory approval for Zavicefta, a combination antibiotic developed in response to the increasingly urgent need for new drugs to treat serious infections that are becoming increasingly resistant to antibiotics.

Zavicefta, a combination of ceftazidime-avibactam that has previously been known as CAZ AVI, has been granted marketing authorisation by the European Commission (EC) treatment of patients with serious Gram-negative bacterial infections requiring hospitalisation, such as complicated intra-abdominal infections and hospital-acquired pneumonia.

Rolls-Royce said the UK's decision to leave the EU would not have an immediate impact on day-to-day business, adding that the medium and long-term effects would depend on whatever post-Brexit deal is agreed.

In a trading statement, RR said it remains committed to the UK “where we are headquartered, directly employ over 23,000 talented and committed workers and where we carry out a significant majority of our research and development”.

It also is confirmed there has been no change to its outlook with overall trading in the first five months of the year broadly in line with expectations and the outlook for the year as a whole is unchanged.

“As outlined in May, underlying profit before financing charges and tax for the first six months of the year is expected to be close to breakeven, with our performance significantly weighted towards the second half,” RR said.

Legal & General announced the appointment of a new group chairman on Monday, confirming former Second Permanent Secretary of HM Treasury Sir John Kingman as taking the up the post.

Its board said the appointment follows a “thorough and exhaustive process” conducted by the nominations committee, with the assistance of a leading executive search firm.

Kingman is succeeding Rudy Markham, who began the search and appointment process for the new chairman whilst senior independent director, and has served as interim chairman since John Stewart’s retirement from the board on 1 June.

The FTSE 100 firm said the appointment has been approved by both the financial regulators, and is subject to the advice of the Cabinet Office Advisory Committee on Business Appointments.