London pre-open: Stocks set to rise on signs of stabilisation in China

Stocks are expected to get off to a good start on Wednesday on signs of a possible stabilisation in Chinese economic growth.

The Footsie was being called to start the say up to 27 points higher from Tuesday's close of 6,275.28. The Shanghai Stock Exchange's Composite index has finished the day higher by 0.27% at 3,650.25.

In parallel, some economists are calling into question the likelihood of further quantitative easing from the European Central Bank in December.

Figures showing soft industrial production in China during October were offset by steady readings on investment and manufacturing output, together with stronger-than-expected retail sales numbers.

"The rebound in fixed investment growth last month suggest that the recent easing of monetary and fiscal policy is beginning to have the desired effect. With policymakers likely to err on this side of caution and continue to adopt an accommodative policy stance, we expect this tailwind to economic activity to last for some time," said Julian Evans-Pritchard, china economist at Capital Economics.

Fixed asset investment in Asia's largest economy rose at a 10.2% year-on-year pace in the first ten months of the year, according to the country's statistics bureau, in line with the consensus estimate from economists.

Speaking on Tuesday evening, Adam Posen, the president of the Peterson Institute for International Economics told CNBC the ECB would not boost QE before the US Fed hikes interest rates.

Speaking to the same broadcaster Lorenzo Bini-Smaghi, an ex-ECB governing council member sounded a skeptical note on the chances of a large cut to the central bank's deposit rate at that meeting. Some market commentary had pointed to speculation that such a move could add to pressure on the single currency.

Sales crater at Sainsbury's

Interim results from Sainsbury's showed like-for-like sales shrank 1.6% and profits crashing 17.9% lower to £308m but ahead of consensus estimates of £300m. Underlying earnings per share tumbled 17.2% to 12p, but were also ahead of forecasts of 11.5p.

Housebuilder Barratt said net private reservations per week in the 19 weeks to 8 November were up 12.5% to 261 with a sales rate of 0.70 (2014: 0.63) net private reservations per active site per week against 0.63 last year. Total forward sales, including joint ventures , rose by 20.7% to £2.5bn. The company said it was “on track to deliver further good progress in FY16”.

TalkTalk estimated the one-off financial impact of the cyber attack that occurred in October at between £30m and £35m. The telecommunications company said earnings before interest, tax, depreciation and amortisation fell to £90m from £110m, missing expectations of around £98m. However, it raised its interim dividend 15% from last year to 5.29p – a move that is likely to surprise analysts and investors who had been expecting a cut.