London pre-open: Stocks seen firmer as investors digest Fed
London stocks were set for a firmer open on Thursday as investors looked to a raft of economic and corporate releases and digested the latest rate decision from the Federal Reserve.
The FTSE 100 was set to open 14 points higher at 7,248.
On Wednesday, the Fed stood pat on rates, as expected, although the odds of an interest rate hike at the central bank's June meeting rose to 94% from around 70% following the accompanying policy statement, in which it brushed aside the importance of weaker-than-expected first-quarter GDP figures.
The French election was also likely to stay in focus as centrist Macron remained ahead in the polls following Wednesday's televised debate between him and Marine Le Pen.
On the data front, net lending, consumer credit, mortgage approval and Markit's services PMI are all due at 0930 BST. In the US, initial jobless claims are at 1330 BST, while factory orders are at 1500 BST.
CMC Markets analyst Michael Hewson said: "This week’s UK data has showed evidence of a decent pickup in economic activity after a bit of a slowdown in Q1, and today’s April services PMI should complete the picture of a solid April performance, after manufacturing and construction beat expectations by bouncing back strongly.
"It is predicted that we could see a bit of a slowdown from March’s 55 to 54.6, but given that these predictions have been wrong twice this week it wouldn’t surprise to see an upside surprise. We will also get to see the latest lending data for March, which is expected to reflect the slowdown in consumer spending as well as the housing market."
In corporate news, retailer Next trimmed the top end of its full year profits guidance after sales fell in the first quarter of its financial year, though to keep investors sweet it declared a second special dividend of 45p per share.
Full price sales for the 13 weeks to 29 April slipped 3.0%, as retail sales tumbled 8.1% but Directory sales from the website and catalogue rose 3.3% in what management expect to be the weakest quarter of the year.
Glencore raised its full year profits target slightly to $2.3bn to $2.6bn despite production in the first quarter being impacted by severe weather such as cyclone Debbie in Australia.
The earning before interest and tax guidance was lifted from $2.2bn to $2.5bn.
Copper production from Glencore's own sources was 3% lower at 324,100 tonnes reflecting grade variations at Alumbrera, the zinc/copper mix at Antamina as its mine plan progresses and ore handling difficulties at Mutanda due to heavy rain.
Morrisons was the latest supermarket group to divulge its position, reporting that in the 13 weeks to 30 April, group like-for-like sales excluding fuel were up 3.4%, comprising contributions from retail of 3.0% and wholesale of 0.4%.
The FTSE 100 company said in its first quarter trading statement that group LFL - including fuel - was up 6.3%, while total sales excluding fuel were up 2.8% - or up 5.8% including fuel - after the impact of last year's store closures.