London pre-open: Stocks seen down as investors eye US CPI data
London stocks were set to fall at the open on Monday, extending Friday’s losses after a mostly weaker session in Asia, as investors eyed this week's US CPI data.
The FTSE 100 was called to open around 25 points lower.
Derren Nathan, head of equity research at Hargreaves Lansdown, said: "The Nikkei is down around 3% today, as the markets raise expectations of a rate rise by the Bank of Japan next week. Following on from a poor week for US tech stocks, the sector is under pressure in the land of the rising sun.
"After Nvidia shares had the wind knocked out of their sails last week, semiconductor firm Renesas has taken a big fall, as has the country’s biggest automobile manufacturer, Toyota, with the strengthening Yen sparking fears over exports. Stocks on the Chinese markets have fared better, following the weekend’s CPI data showing prices were up 0.7% in February, after a four-month run of deflationary read-outs. Nevertheless, concerns over Chinese growth continue to hold back the oil price, with Brent Crude falling to below $82 per barrel.
"US stocks look set to tick down on the open, inching away from record highs seen last week. Mixed jobs data on Friday gave the Fed plenty to think about, as investors continue to play the waiting game as to when the starting gun for rate cuts will be fired. Despite nonfarm payrolls adding 275,000 against forecasts of 200,000, US unemployment has hit a two year high of 3.9%.
"Policy setters’ gaze will now turn to consumer prices, with February’s CPI data expected tomorrow. Anything north of the 3.1% forecast for annual rate rises may push expectations of a rate cut further down the road. Retail sales on Thursday will be another key measure as to how hot or not the economy is running. Investors looking for an index to buck the downward trend are unlikely to find any comfort in the FTSE 100, which is expected to extend Friday’s losses at the open."
In corporate news, US private equity firm Elliott Advisors has pulled from the race to take over Currys after "multiple attempts" to engage with UK electrical retail chain’s board, all of which were rejected.
Currys shares surged last month when it was revealed that Elliott had made an initial potential offer worth £700m - later reportedly upped to £800m. Meanwhile Chinese e-commerce giant JD.com also entered the fray.
Shaftesbury Capital has acquired the freehold interests in 25-31 James Street, Covent Garden for £75.1m, expanding its portfolio with properties generating a contracted rent of £3.9m.
With 21,000 square feet of lettable space, including retail and residential or office areas, the acquisition complemented existing holdings in the prime retail district. It said the move followed recent disposals, totalling £145m.
Real estate group British Land is appointing the current chair of Intermediate Capital and Marston's as its new chair designate.
William Rucker is to succeed incumbent chair Tim Score on 9 July, when Score will stand down after five years as chair and ten years on the board.