London pre-open: Stocks seen up after positive Wall St session
London stocks were set to rise at the open on Tuesday following a positive session on Wall Street.
The FTSE 100 was called to open 17 points higher at 7,079.
CMC Markets analyst Michael Hewson said: "After an initially negative start yesterday markets in Europe turned around strongly to finish the day higher, as investors slowly get used to the idea that all of this talk about the prospect of rate rises and tapering is merely finessing a timeline, rather than any underlying concerns that the Fed is going to be knee jerk when it comes to withdrawing stimulus and potentially raising rates.
"US markets also had a strong session with the S&P500 reversing its losses of Thursday and Friday, while US 10-year yields snapped back to 1.492%, having hit a two-month low of 1.3530 earlier in the day.
"The US dollar also gave back its Friday gains in the wake of last Friday’s and yesterday’s Bullard comments, as John Williams of the New York Fed took a more nuanced view saying that the economy hasn’t recovered sufficiently for stimulus to be withdrawn, and that the central bank remains ‘a ways off achieving substantial progress’, reiterating his view that inflation is transitory, as attention turns to today’s Powell testimony to US lawmakers.
"After yesterday’s recovery, and strong US finish markets in Europe look set for a positive start, with markets in Asia having a decent session and the Nikkei 225 recovering a decent proportion of yesterday’s losses."
In corporate news, DS Smith said the current financial year had started well as the packaging company reported a sharp drop in annual profit caused mainly by higher costs and lower prices during the pandemic.
Pre-tax profit for the year to the end of April fell 38% at constant currency to £231m as revenue dipped 1% to £5.98bn. DS Smith declared a final dividend of 8.1p a share, taking the annual payout to 12.1p a share. Adjusted operating profit fell 24% to £502m.
National Express said current trading was slightly ahead of expectations as it further expanded European operations with the €13m acquisition of Spanish urban bus operator Transportes Rober.
“Trading performance across the group continues to improve, slightly ahead of management expectations, and we have continued to win new contracts, notably in corporate shuttle both in North America and the UK,” the company said in a statement.