London pre-open: Stocks to rise ahead of week of major data

Blue chip stocks in London were expected to start on the front foot on Monday ahead of a big week of economic data.

The FTSE 100 index was called 33 points higher ahead of the open, indicating some optimism over the flash Japan, US and eurozone manufacturing and services PMI releases coming later in the morning.

Later in the week, the official readings on UK and US gross domestic product will be published as well as the US non-farm payrolls report at the end of the week, ahead of the meetings of the Bank of England, Bank of Japan and US Federal Reserve next week.

"It’s going to be interesting to see just how involved traders are this week given that next week we have monetary policy decisions from the Fed, the BoJ and the BoE," said analyst Craig Erlam at Oanda. "To cap it off we’ll get the latest US jobs report on the Friday and I’m wondering whether this could affect risk appetite over the course of this week."

The PMI numbers are not expected to be particularly inspiring, Erlam said, with French numbers seen moving back into rare growth territory and euro area manufacturing PMI is expected to remain steady 52.6 while the services PMI is expected to rebound slightly to 52.5 but remain in a trend of slowing growth, probably driven largely by similar declines in the German data.

"The Fed speeches this afternoon will also be of great interest, coming a little over a week before the November meeting. Markets continue to price in a high probability of a rate hike in December, still around 70%, while November has been all but written off due to the Presidential election a week later and the absence of a press conference after."

Among UK corporate announcements, Randgold Resources said its Tongon gold mine in Côte d'Ivoire was building a solid portfolio of targets and was still adding new exploration permits. The FTSE 100 firm said Tongon's performance was continuing to improve across the board and management was still targeting the revised annual guidance for the year, after a difficult first half which had been impacted by a long mill breakdown.

There was a profit warning from Cobham due to softer conditions in the wireless and satellite communications markets. Although management expects an improvement in the fourth quarter, its expectations for the full year and hence also its profit guidance is now lower than initial estimates.

Pharmaceutical behemoth GlaxoSmithKline announced it has submitted a shingles vaccine for US regulatory approval. Shingrix, a non-live recombinant vaccine which prevents herpes zoster, or shingles, in people aged 50 years or over, was submitted to the US Food and Drug Administration for approval for it to be given intramuscularly in two doses, with a two to six month interval.