London pre-open: Stocks seen muted ahead of inflation data

London stocks were set for a muted open as investors eyed the release of key UK inflation data.

The FTSE 100 was expected to open just two points higher at 7,432.

On the data front, the UK producer price index, retail price index and consumer price index are all at 0930 GMT, along with public sector net borrowing figures.

London Capital Group's Ipek Ozkardeskaya said: "Analysts expect acceleration in the headline inflation to 2.1% year-on-year from 1.8% printed a month earlier. In a similar way, the core inflation may have accelerated to 1.7% y/y from 1.6% previously.

"A solid inflation report could confirm the MPC members’ worries regarding the rising inflationary pressures, boost the BoE hawks and push the GBPUSD to fresh three-week highs. In case of a softer read, the 100-day moving average should remain the major technical challenge. Technical indicators remain neutral before the data."

In corporate news, Bellway hoisted its interim dividend 10% as the housebuilder enjoyed continued strong demand in the first half and maintained its targets for the full year.

Revenue of £1.15bn for the six months to the end of January was a 5.9% improvement on the same period a year ago as the company completed 4,462 homes at an average selling price of £256,000.

CLS Holdings said it has exchanged contracts to buy a multi-let office property in Perlach, in the south-east of Munich, Germany, for €15.3m (£13m).

The building comprises 9,449 square metres of office space which, with an occupancy rate of 88%, currently generates a rental income of €0.8m a year, reflecting a net initial yield of 5.1%, or 6.2% when fully let, CLS said.

Enquest said the development of the Kraken field continued to be on track and is running under budget, while reiterating previous guidance for full-year 2017 production of between 45,000 and 51,000 barrels per day depending on the timing of first oil at Kraken. Last year production grew 8.7% to 39,751 b/d.

At the end of 2016 the oil explorer's level of net debt stood at $1.796.5bn, up from $1,548bn in the year before, as expected by analysts. For 2016, the company said cash generated from operations rose from $221.7m in 2015 to $408.3m. Revenue and other operating income on the other hand slipped 6.3% to $849.6m.

Vectura Group, a maker of inhaled airways products, reported that revenue grew last year on the back of recently launched products.

For the nine months ended 31 December, revenue increased 76% to £126.5m, compared to the same period the previous year, following the momentum of seven recently launched inhale products with in-market net sales rising 81% to $2bn.