London pre-open: Stocks to fall as investors mull GDP
London stocks were set to fall at the open on Thursday following a downbeat US session, as investors digest the latest UK GDP data.
The FTSE 100 was called to open 20 points lower at 7,320.
Figures released earlier by the Office for National Statistics showed that growth in the UK economy slowed in the third quarter.
GDP grew 1.3% between July and September, down from 5.5% in the second quarter and missing expectations for 1.5% growth. That leaves quarterly GDP 2.1% below where it was in the last quarter of 2019, before the pandemic hit.
On a monthly basis for September, GDP grew 0.6%, which was a bitter better than expected.
Paul Dales, chief UK economist at Capital Economics, said: "The big point is that the best of the recovery is now behind us. And we think progress is going to slow over the next six to nine months as shortages remain an issue and the real spending power of businesses and households is reduced by higher taxes and rising utility prices.
"This won’t prevent the Bank from raising interest rates from +0.10% (perhaps in December), but we think it will contribute to rates going no higher than 0.50% next year."
In corporate news, WH Smith narrowed annual losses and said it expected to hit 2019 sales levels in this financial year as the travel sector opened up from Covid-19 restrictions.
The stationery retailer reported a pre-tax loss of £116m compared with a loss of £280m.