London pre-open: Stocks to rise as German growth accelerates

Strong data from Germany is expected to give UK stocks a boost on Friday, while concerns about Greece and Ukraine continue to ease.

City sources predict the FTSE 100 will open 28 points higher than Thursday’s close of 6,828.11.

German economic growth picked up to 0.7% in the fourth quarter of 2014 from 0.1% the preceding three months, well ahead of the 0.3% expansion predicted.

The figures from the Eurozone’s largest economy suggest upside risk to the wider region’s own gross domestic product data due out at 10:00 on Friday. Consensus forecasts currently are for Eurozone growth to remain at 0.2% in the fourth quarter.

In other news, the leaders of Ukraine and Russia agreed to a ceasefire to begin on Sunday.

“Investors also appear confident that a Greek disaster can also be averted on unconfirmed reports that German and Greek officials were working on a compromise in Brussels as both sides looked to soften their positions,” said analyst Michael Hewson from CMC Markets.

The speculation comes before the next Eurogroup meeting scheduled to begin on Monday.

Stocks to watch

The recent plunge in iron ore prices has prompted mining giant Anglo American to write-down the value of certain assets by $3.9bn, pushing the company into the red for the 2014 financial year. When including write-downs, $3.5bn of which related to its Minas-Rio iron ore project in Brazil, Anglo swung to a pre-tax loss of $259m in 2014, compared with a profit of $1.7bn in 2013.

Utilities group Severn Trent said in a third-quarter update that it is on track to hit expectations this financial year. In line with its previous guidance for its regulated business, the company said consumption across its measured income base is expected to be slightly higher than last year as a result of warmer weather. However, costs are expected to rise year on year due to the impact of inflation and quasi taxes.

Rolls-Royce reported an underlying revenue drop of 6% in its full-year results for 2014, caused by reduced defence-customer spending and flailing commodity prices. The company also revealed on Friday that is has appointed a former HSBC banker as a new non-executive director on its board.

British Land has commenced development of a new 146,000 sq ft office building at Paddington Central. The company acquired the Paddington Central campus early in July 2013 and planning consent for the new property design was originally won back in 2010.