London pre-open: Stocks seen up after solid US session

London stocks were set to rise at the open on Tuesday following solid gains on Wall Street.

The FTSE 100 was called to open 18 points higher at 7,712.

CMC Markets analyst Michael Hewson said: "US markets performed better than they did on Friday in the wake of a decent payrolls report and lacklustre ISM services survey for December, with tech outperforming.

"A decent performance from the Nasdaq 100, helped drive sentiment after Nvidia announced a significant improvement in chip design with extra components which would allow the better use of AI, sending the shares up to fresh record highs.

"The move higher was helped by weakness in US treasury yields which slipped further away from their peaks of last week in anticipation of this week’s US inflation numbers, after New York Fed 1 year inflation expectations fell to 3.01% in December, from 3.36%.

"The strong US finish seen last night looks set to ripple out into today’s European open with a solid start expected."

On home shores, industry data showed that retailers ended 2023 on the back foot despite a modest uptick in demand in the week leading up to Christmas.

According to the latest BRC-KPMG Retail Sales Monitor, UK total sales increased by just 1.7% in the five weeks to 30 December, compared to a 6.9% rise a year previously.

The increase was below the three-month average of 2.3%, and the 12-month average of 3.6%.

December is the most important month of the year for many retailers, as consumers splash out on homewares, presents and festive food.

Helen Dickinson, chief executive of the British Retail Consortium, said there had been a "slight" uptick in the week leading up to Christmas.

But she added: "The festive period failed to make amends for a challenging year of sluggish retail sales growth, as weak consumer confidence continue to hold back spending.

"The post-Christmas sales were unsuccessful in enticing spend in areas such as furniture and homewares, with households remaining cautious about making larger purchases.

"2024 looks to be another challenging year for retailers and their customers, and spending will continue to be constrained by high living costs."

In corporate news, B&M European Value Retail reiterated its full-year guidance as it posted a 5% jump in third-quarter sales.

The discount retailer said it still expects group adjusted EBITDA of between £620m and £630m for FY24, up from £573m a year earlier.

GSK said it was buying Aiolos, a clinical-stage biopharmaceutical company focused on treatment of respiratory and inflammatory conditions, for a $1bn (£780m) upfront payment and up to $400m in milestone payments.

The deal provides GSK with access to Aiolos' AIO-001, a drug ready to enter phase II clinical development for the treatment of adult patients with asthma, with potential for additional indications including chronic rhinosinusitis with nasal polyps.

Infrastructure services group Hill & Smith said it had bought the business and assets of New Jersey-based Capital Steel for $6.25m (£5m), on a debt and cash free basis.

Capital Steel, located in Trenton, is led by Robert Hickman who will stay with the company. It supplies structural steel products and services principally into the electrical transmission and distribution market in New York, New Jersey and Pennsylvania.

Under the terms of the deal a further $1.2m is payable conditional on Capital Steel's achievement of financial performance targets in the two years post-acquisition.