London pre-open: Stocks seen a little lower ahead of GDP

Stocks in London were set to open a little lower as investors eyed the release of UK GDP data, with volumes expected to be light again as US markets will only be open for a half day.

The FTSE 100 was called to open nine points lower than Thursday’s close at 6,820.

The second release of third-quarter gross domestic product is at 0930 GMT.

CMC Markets’ Michael Hewson said: “Today’s latest UK Q3 GDP revision will be the latest iteration of that economic outperformance, where it is expected to come in unchanged at 0.5% on a quarterly basis, and 2.3% on an annualised basis. That’s not to say everything is fine and dandy, far from it as it is likely that business investment might see a sharp decrease of 1%, due to some of the uncertainty created as a result of the summer Brexit vote.

“Exports are expected to show an improvement due to the weaker pound, with an increase of 1% expected, while the services sector is expected to show that it did most of the heavy lifting. “

In corporate news, BHP Billiton and its Brazilian joint venture partner Vale said they have approved $181m to fund remediation and compensation programs at the Samarco iron ore project after a dam burst in a year ago.

The two companies will extend a £230m line of credit to Samarco. The funding will be offset against a $1.2bn provision made in June.

“Funds will be released to Samarco only as required and subject to the achievement of key milestones,” BHP said.

“The short-term facility allows BHP Billiton Brasil to preserve the value of its investment as options for restart continue to be assessed.”

Elsewhere, Pennon continued to deliver a good performance in the first half of its financial year at both its water and waste businesses.

South West Water delivered a sector-leading return on regulatory equity of 11.7%, while its Viridor waste cycling unit was on track to hit its target for operating profits amid improved margins.

During the reporting period the firm also decided to commit £252m to an energy recovery facility at Avonmouth, thus increasing its portfolio to twelve plants.

The utility also unveiled a new retail venture for business customers with South Staffs/Cambridge Water.