London pre-open: Stocks seen a touch higher but trade worries to cap gains

London stocks were set to edge up at the open on Friday following heavy losses in the previous session, but gains were expected to be limited amid worries about Sino-US trade relations.

The FTSE 100 was called to open seven points higher at 7,100.

London Capital Group analyst Jasper Lawler said: "President Trump saying that he was not planning to meet with China’s President Xi Jinping before the March 1st trade truce deadline hit sentiment overnight.

"Asian markets tumbled the most in over a month as fears spread that the world’s two largest economies will not manage to hash together a trade deal before tariffs are due to rise.

"Up to now the markets have been optimistic about a trade deal being reached, despite little solid evidence. Trump’s stance is now rattling investor nerves just weeks before the deadline. With US corporate earnings starting to dry up, traders' full focus will soon be back on trade developments. With no deal in sight this will have a negative bias on equity market flows."

In UK corporate news, SSE said full year adjusted EPS would be 6p lower as a result of the Capacity Market “standstill”, taking the forecast to 64p to 69p a share.

The EU General Court ruled last November that Britain must halt payments under the scheme pending an investigation by European Union regulators. SSE said it was due £60m.

Ahead of what could be a quarrelsome annual shareholder meeting later in the day, property developer Shaftesbury said it had made some progress with its larger schemes at the start of its new financial year.

The group, which owns a swathe of shopping streets in London's West End, reported the total portfolio valuation increased 3.8% to £3.95bn with estimated rental value up £9.5m to £154m.