London pre-open: Stocks seen higher ahead of jobs data

London stocks were set for a positive open on Tuesday, taking their cue from upbeat sessions in the US and Asia as investors eyed the release of key UK jobs data.

The FTSE 100 was called to open 11 points higher at 7,386.

CMC Markets analyst Michael Hewson said: "European markets got off to a positive start to the week yesterday, as did US markets however the gains were limited by concerns over the durability of the US’s immigration deal with Mexico, as well as the prospect that we could see tariffs go on the remaining $300bn of Chinese goods by the end of the month.

"This threat was spelt out by President Trump when he said the tariffs would go on if President Xi didn’t show up at this month’s G20 meeting. In a sign that the US President may well widen the scope of his trade war he also suggested that the US would start looking at measures to address the issue of tariffs on wine, particularly French wine. As if the EU didn’t have enough on its plate with respect to the prospect of auto tariffs it now looks as if the US may be gearing up to widen the scope of its tariffs on EU goods.

"While equity markets managed to push their way higher there was further evidence yesterday that economic activity was continuing to slow. China’s latest trade data showed that domestic demand remained weak, while in the UK the latest manufacturing data in April saw a sharp slowdown in economic activity as car manufacturers brought forward their summer shutdown periods as a precaution against a 'no deal' Brexit."

On the data front, the claimant count, average earnings and the ILO unemployment rate are all due at 0930 BST.

"Having seen manufacturing activity fall sharply in April there is a concern that wage growth could start to go the same way as the economy slows," Hewson said.

In corporate news, Ted Baker warned on profits as it said it faces "extremely difficult trading conditions".

The fashion retailer now expects underlying profit before tax in the range of £50m to £60m in the year ended 25 January 2020. This compares with a pre-tax profit excluding exceptional items of £63m posted in its last full year.

Smith & Nephew said it was buying Switzerland's Atracsys, a provider of optical tracking technology used in computer-assisted surgery, for an undisclosed sum.

Atracsys' fusionTrack 500 system offers superior measurement speed and latency performance, supporting reduced procedure times, as well as increased accuracy resulting in finer precision surgical tasks, such as bone cuts, compared to existing tracking technology, Smith & Nephew said in a statement.

The acquisition was expected to complete during the third quarter of 2019, it added.

Compass Group has agreed to buy Nordic food catering business Fazer Food Services for around €475m.

Compass said the deal is "very attractive" for the group, which already a presence in the region.

The company's chief executive officer, Dominic Blakemore, said: "Fazer Food Services is a highly regarded food service business in the Nordic region, and like Compass, is focused on high-quality food, culinary innovation, sustainability and great customer service.

"I am excited that, together with our existing colleagues in the region, we will be able to further enhance our customer proposition in the Nordic market."