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

London stocks were set for a muted open on Tuesday following solid gains in the previous session.

The FTSE 100 was called to open flat at 7,288.

CMC Markets analyst Michael Hewson said: "Both markets in Europe and the US saw a positive start to November, with the FTSE 100 pushing above 7,300 for the first time since February 2020, while US markets once again set new records, in a year that has seen the S&P500 set a new record high every month this year.

"With 80% of companies in the S&P500 so far beating expectations on earnings, concerns about rising prices impacting company profit margins are for now being set aside, with consumers seemingly being able to absorb their impact.

"Whether this trend can continue is obviously a moot point, with central banks seemingly intent on starting the withdrawal process of some of their stimulus measures, however for now the path of least resistance would appear to be for further gains for stock markets, as long as central banks don’t overplay their hand.

"As we look ahead to today’s European open, we can expect to see a fairly flat open, as we look ahead to the latest manufacturing PMI numbers for October from Spain, Italy, France and Germany, all of which are expected to see a modest softening in economic activity, with Spain expected to come in at 58.1, Italy, 59.6, France, 53.5 and Germany 58.2."

In corporate news, surging oil and gas prices helped energy giant BP report better-than-expected third quarter profits as demand for its products soared on the back of economic recovery from the Covid pandemic.

Underlying replacement cost profit came in at $3.32bn, beating forecasts of $3.06bn and compared with a $2.8bn profit in the previous three months and $86m a year ago. The dividend was maintained at 5.46 cents a share.

Standard Chartered's underlying pre-tax profit rose 44% to $1.08bn in the third quarter as income rose and bad debts fell sharply. Underlying operating income increased 7% to $3.77bn in the three months to the end of September. Underlying credit impairments fell 70% to $108m.

The bank said it expected annual income to be similar to the year before on a constant currency basis but to be lower in the fourth quarter than in the third. Statutory pre-tax profit more than doubled to $996m from $435m.