London pre-open: Stocks seen muted ahead of US earnings

London stocks were set for a muted open on Tuesday as investors eye the start of the US earnings season, with results due this week from the likes of Citi, JP Morgan and Goldman Sachs.

The FTSE 100 was called to open just two points higher at 7,127.

Investors were also likely wary as the UK earnings calendar was set to pick up, with Burberry, Dunelm and Barratt Developments all slated to report this week.

On the macro front, figures released by China earlier showed that exports unexpectedly rose in June.

CMC Markets analysts Michael Hewson said: "Today’s June numbers were actually better than expected with imports rising by 36.7%, while exports rose by 32.2%, part of the reason being the continued rise in commodity prices impacting both sides of the ledger. The main gains on the export side were mainly due to higher demand from the likes of South Korea and Japan, while US exports slowed to 17.8%.

"Against this backdrop markets in Europe look set to open broadly unchanged with today’s focus on June CPI numbers from Germany, France and the US, while UK retail sales enjoyed their best quarter ever according to the British Retail Consortium. The month of June saw a big jump in spending on clothing and footwear, as well as sales of TV’s and food and drink sales with the start of Euro 2020. Spending on hotels and accommodation also rose as a result of the easing of restrictions in May."

In corporate news, Phoenix Group said it had sold its Ark Life Assurance unit to Irish Life Group for €230m (£197m).

"This transaction simplifies our European operations and accelerates the cash release from this business. The group expects to redeploy the capital into higher return growth opportunities to drive incremental future cash generation," the company said in a statement.

Elsewhere, Howden Joinery said trading was strong in the first half and ahead of its expectations with revenue ahead of the same period in 2020 and 2019. Group revenue was almost £785m in the six months to the end of June compared with £465m a year earlier and £653m two years earlier.

UK depot revenue was about £764m - up 19.8% from 2019 and 15.3% on a same-depot basis. Howden said this pattern had continued and it was cautiously optimistic about the outlook. The FTSE 250 group said it expected annual pre-tax profit of about £300m - up from £185.3m in 2020 and £260.7m in 2019.