London pre-open: Stocks seen higher ahead of US ADP report

London stocks were set to rise at the open on Wednesday, taking their cue from an upbeat performance on Wall Street, having fallen to a three-month low in the previous session due to sterling strength.

The FTSE 100 was called to open 35 points higher at 5,897, with all eyes on the release of the US ADP employment report later.

CMC Markets analyst David Madden said: "A lack of positive news weighed on European equity markets yesterday and the FTSE 100 was the under performer of the bunch. Keep in mind the London market was closed on Monday as it was a UK bank holiday, and continental markets finished lower that day, so it was like the British market was playing catch-up yesterday - it traded at its lowest level since mid-May.

"Meanwhile, the bullish run on US tech stocks continued as the Nasdaq 100 outperformed and set another record close. The S&P 500 set a record close too."

The ADP report, due at 1315 BST, is expected to show that 950,000 jobs were added last month, and that would be a big improvement on the 167,000 created in July, said Madden.

In corporate news, Computacenter said annual results were likely to be materially better than the company's previous expectations.

The computer services company said successful trading in the first half of the year had continued in the first two months of the second half. Computacenter reports first-half results on 9 September.

Full-year profits at house builder Barratt almost halved as the coronavirus lockdown hits sales in the fourth quarter, although it reported a sharp rise in completions in the new year as restrictions were eased.

The company said pre-tax profits fell 45.9% to £491m with completions falling by a third to 12,604. No dividend was declared.

Barratt said total forward sales, including joint ventures at August 23 stood at 15,660 homes compared to 13,064 a year ago.

“The increased activity levels are being stimulated by a combination of pent-up demand, the stamp duty holiday and an understanding that Help to Buy will only be available to first time buyers and regional home price caps will exist from April 2021,” the company said.