London pre-open: Stocks to drift lower despite gains on Wall Street

The Footsie is seen starting the session six points lower from Monday´s closing level of 6,273.40.

On Monday evening, Exxon Mobil reported a pipeline failure and spill at its Torrance refinery near Los Angeles. That came close on the heels of news of fresh attacks against the oil sector´s infrastructure in the Niger Delta.

Traders were also keeping close tabs on the flow of Brexit poll results. The two latest polls from ORB for The Daily Telegraph and from YouGov for The Times both revealed a small lead for the 'Remain' camp.

As of 07:45 BST cable was 0.48% higher to 1.4516 but at one point during Asian trading hours it spiked by 1.5% to reach 1.4662, with traders referencing speculation in markets that a so-called 'fat-finger' trade had triggered the move.

"We’ve had a couple more Brexit polls overnight and both point to a very narrow one point lead for the “Remain” campaign. With momentum, though, very much with the “Leave” campaign, it would appear, at least from the recent polls, that there is a very real chance that the UK could vote out, which could play havoc with the markets, particularly the pound," said Craig Erlam, senior market analyst at Oanda.

Traders were also busy parsing a key speech from US central bank chair Janet Yellen in the previous session, which appeared to close the door on the possibility of interest rate hikes come the next Fed meeting on 15 June.

"Yellen was much more dovish than in her recent speech, as she did not repeat that a hike 'in the coming months' could be appropriate, which supports our view (and market expectations) that a summer hike is off the table.

"Although Yellen said that she thinks the positive factors are outweighing the negative, she highlighted the downside risks to the economic outlook," analysts at Danske Bank said in a research note sent to clients.

Oil major raises target for cost savings

Shell said it was increasing the level of cost cuts from its merger with BG Group to $4.5bn from $3.5bn. In an update, the company said it expected to “achieve and exceed the $3.5bn synergies prospectus commitment earlier than expected, in 2017, when synergies should be $4bn. “Our other deal-related financial commitments to shareholders in the form of asset sales, debt reduction, and dividends, followed by share buy-backs, are unchanged, said chief executive Ben van Beurden. Shell also said it expected capital investment for 2016 to be $29bn excluding the purchase price of BG Group.

Direct sales insurance firm Esure announced a strategic review of its Gocompare comparison service on Tuesday, and indicated an interest in spinning it out on its own. The FTSE 250 firm said that, in the first full year of ownership after acquiring the outstanding 50% of Gocompare for £95m, the marketing strategy was “invigorated” driving growth in insurance comparison, the cost base restructures and focus given to a wider range of products.