London pre-open: Stocks seen higher on solid US cues

London stocks looked set for a slightly firmer open on Wednesday, taking their cue from Wall Street, where the Nasdaq and S&P 500 closed at new all-time highs on Tuesday on the back of some solid earnings and a strong performance in the basic resources sector.

The FTSE 100 was expected to open 13 points higher than Tuesday’s close at t 7,163.

CMC Markets’ Michael Hewson said: “While politics is likely to continue to play an important part in how the pound performs in the next few days and weeks, the fact that we now have a greater degree of clarity about the Brexit destination has helped create a degree of certainty that was lacking a few days ago. A government bill outlining the legislation for triggering Article 50 is expected in the next few days.

“Investors now appear more concerned about what new US President Trumps policies will do to the strength of the US dollar. If investors thought the last few months for UK politics have been unpredictable then in President Trump they’re likely to get further unpredictability in spades, when it comes to US politics.”

In corporate news, Chilean copper giant Antofagasta enjoyed a strong fourth quarter performance and kept cash costs for the year below its guided level.

The final quarter of 2016 saw copper production 205,500 tonnes, up 13.8% versus the previous quarter to lift production for the full year to just under 710,000 tonnes, 12.5% higher than the prior year.

Mining giant BHP Billiton posted its operational review for the half year to 31 December, with record production achieved at Western Australia Iron Ore, and total iron ore production of 118 Mt - a 4% rise year-on-year.

The company also saw an increase in metallurgical coal production - up 1% to 21 Mt - though all other sectors were softer, with energy coal down 4% to 14 Mt, copper reducing 7% to 712 kt, and petroleum production falling 15% to 106 MMboe.

Fresnillo achieved record production of gold and silver production in 2016, even though the miner experienced some delays in implementing its turnaround plan.

Record yearly silver production of 50.3m ounces, including silverstream, was achieved in the 2016 calendar year, up 7.1%, compared to the previous year and in line with guidance, mainly due to the start of the first phase of production at the San Julian mine in Mexico. It delivered record annual gold production of 935.5k ounces, an increase of 22.8% and ahead of guidance, due to reduced gold inventories at Herradura and an improved average speed of recovery at the Noche Buena site.

On the data front, the CBI industrial trends survey is at 1100 GMT.