London pre-open: Shares set to extend losses on Friday
The FTSE 100 is set to extend losses on Friday morning ahead of a day full of data across Europe and the closely-watched non-farm payroll report in the US.
Early data from China was encouraging, however, with China’s manufacturing sector surprising with its first expansion in nine months, according to the official purchasing managers’ index (PMI) survey.
The official PMI rose to 50.2 in March, up from the previous month’s 49 and marginally above the 50-point mark that indicates growth, as well as beating a consensus forecast of 49.3.
On the services side, official non-manufacturing PMI coming in at 53.8, up from 52.7 in February.
"Asia markets seem to have taken their cues from the latest Japanese Tankan survey which was disappointing with the Nikkei sliding sharply, and this looks set to weigh on European markets this morning as we look ahead to more data from Europe’s major economies," said CMC Markets analyst Michael Hewson,.
Hewson said most of traders' attention on Friday will be on the afternoon’s US jobs report for March, following a reasonably solid ADP number earlier this week is forecast to see a slight fall to 206,000, from February’s 242.
The trading session before the NFP data may remain quiet as traders hold back from playing the wrong hand.
Danske Bank economists observed that some attention should also be on the ISM manufacturing index in March.
"As the regional indices were strong on a broad scale in March, we see this as a sign that the manufacturing sector has rebounded and estimate ISM manufacturing increased to 50.9 in March from 49.5 in February."
In London's corporate news, the board of Home Retail agreed to recommend Sainsbury's takeover offer, which was made at 0.321 new shares in the supermarket group and 55p cash, plus 27.8p in dividends. With Sainsbury's shares closing at a price of 276.3p on Thursday, the offer values Home Retail shares or 171.5p and the company's total equity at £1.4bn when the dividend payments are factored in.
RSA Insurance Group confirmed it had completed the sale of its operations in Colombia to Grupo de Inversiones Suramericana. The company said it expected that the completion of the remaining disposals of its Latin American operations - in Chile, Argentina, Mexico and Uruguay - to occur over the next six months.
Euromoney Institutional Investor announced its intention to sell its energy publishing businesses on Friday, for a total cash consideration of $18m. The FTSE 250 firm said it had entered into an agreement to sell Gulf Publishing Company in Houston and Petroleum Economist in London to a consortium led by Gulf’s CEO John Royall and media investor Russell Denson.
The Times reported that some of the UK’s biggest companies, including Rolls-Royce and Petrofac, have been drawn into a scandal over alleged bribery and corruption in the international oil industry. "The Serious Fraud Office is understood to have teamed up with the FBI and the US Department of Justice to investigate claims that a Monaco-based lobbying firm, Unaoil, was involved in the payment of bribes to officials in Iraq, Syria, Kazakhstan, Kuwait and other oil-producing nations," the paper said.
There were also newspaper reports that Tesco is mulling the sale of its Giraffe restaurant chain and that Royal Mail was braced for a new dispute with unions after a deadline for a new pay deal passed overnight.