London pre-open: Stocks seen up after Monday's losses
London stocks were set to rise at the open on Tuesday following heavy losses in the previous session.
The FTSE 100 was called to open 45 points higher at 6,949.
CMC Markets analyst Michael Hewson said: "European markets had a bit of a shocker yesterday, posting their worst declines in two months with the DAX and FTSE 100 both hitting a two-month low.
"While most of the factors driving yesterday’s sell off have been on the radar for a while, concerns over the solvency of Chinese retail estate company Evergrande were the proverbial straw that broke the camel’s back, helping to send the Hang Seng to thirteen-month lows in the process. That said it’s not as if this denouement on the part of Evergrande hasn’t been coming, with the only surprise being why Chinese regulators have allowed it to fester in the way it has.
"With Japanese markets returning today it is perhaps no surprise that we’ve seen a weaker Nikkei 225, as concerns over events in China, rising costs, and slowing growth keep investors on the back foot, however the losses while heavy have been contained, and with that European markets look set to open modestly higher this morning, with US futures also rebounding.
"Concerns about Evergrande remain but for now there appears to be a wait and see approach being adopted."
In corporate news, DIY retail group Kingfisher said third quarter like-for-like sales to September 18 were down 0.6% year-on-year as it reported a surge in interim profits and revenue along with a £300m share buyback.
The company posted a 70.6% rise in pre-tax profits to £677m for the six months to July 31. Sales rose 20% to £7.1bn. LFL sales in the second quarter fell 0.8% due to unseasonal weather in the UK and France.
It lifted second-half LFL sales expectations to -7% to -3% from -15% to -5% and guided for annual profits of £910m to £950m.
Compass said fourth-quarter performance was ahead of guidance as diners returned to sports and leisure venues and schools and colleges reopened.
Revenue in the three months to the end of September is expected to be about 86% of the same period in 2019 and annual revenue will be about 76% of that year's, the FTSE 100 caterer said.
Compass had previously said fourth-quarter revenue would be 80-85% of the 2019 level. Underlying profit margin in the fourth quarter will be around the middle of guidance for 5.5% to 6%.