London pre-open: Stocks seen lower after Monday's gains

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Sharecast News | 21 Jun, 2016

Updated : 07:26

London stocks were seen opening lower following the strong session on Monday, when sentiment was underpinned by polls suggesting a swing in favour of the Remain campaign.

The FTSE 100 was expected to open 19 points lower than Monday’s close at 6,185.

CMC Markets’ Michael Hewson said: “While yesterday’s rebound in risk was helped by a shift in the polls towards ‘Remain’ the reduced prospect of an imminent Fed rate rise could well have helped as well given last week’s comments by St. Louis Fed President James Bullard when he suggested that in his view the prospect of multiple Fed rate rises was becoming ever more distant.

“This was, and is a remarkable shift in narrative from someone who last year was one of the more notable Fed hawks. Later today Fed chief Janet Yellen begins her two day semi-annual testimony to US lawmakers fresh from last week’s rate meeting where we saw US rates left on hold. She also gave the impression of being rather concerned about the recent slowdown in the pace of jobs growth and her discomfort about committing to the next meeting or two about the prospects of a rate rise were in stark contrast to recent comments that a rate rise would probably be appropriate in the coming months.”

On the data front, UK public finances are at 0930 BST while CBI industrial trends are at 1100 BST.

In corporate news, Whitbread served up a slight improvement in sales in the first quarter of the year as its Costa coffee shops bounced back from a slowdown in the preceding few months.

Group like-for-like (LFL) sales grew 1.8% as although Costa's sales were up 2.6%, the group's Premier Inn hotel chain saw LFL sales slow further to 2.1% from the rate seen in the fourth quarter.

BHP Billiton said it was targeting another $600m in coal production costs by the end of the 2017 financial year.

BHP also increased its forecast for coal output for the current year to 43m tonnes, with plans to lift production to 46m tonnes in 2018.

"While cost compression has been evident across the industry, we continue to work hard under our new operating model to improve our performance," said BHP Billiton Minerals Australia president Mike Henry.

"Even in today's difficult environment, all of our operations remain cash positive."

Takeaway food digital marketplace Just Eat announced on Tuesday that it has appointed Paul Harrison as chief financial officer and as an executive director, replacing Mike Wroe on 28 September.

The FTSE 250 firm said Harrison is joining from WANdisco - a Silicon Valley-based, London-listed software company - where he has been chief financial officer since 2013.

Prior to WANdisco, Harrison was group finance director at FTSE 100 software company The Sage Group for 13 years, and held a number of senior positions at the then-Price Waterhouse.

Saga said it was on track to achieve its targets for the year ending 31 January 2017 and continues to make good progress against its strategic priorities.

Ahead of its annual general meeting at its headquarters in Folkestone later, the group, which provides products and services for the over 50, said it had seen solid trading across the core insurance and travel businesses.

Chief executive officer Lance Batchelor said: “We have made a good start to the year across our core trading divisions. We continue to focus on our strategic objectives and remain on track to deliver on the targets we set out at our preliminary results on 19 April 2016.”

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