London pre-open: Stocks to fall; investors face another earnings deluge

The FTSE 100 was called to open 15 points lower at 7,915, with another deluge of corporate news out.

CMC Markets analyst Michael Hewson said: "European markets finished the day slightly higher yesterday after Federal Reserve chairman Jerome Powell clarified his comments from the previous day with respect to what the Fed is likely to do on rates in two weeks’ time.

"In a manner of a parent soothing an errant child who is throwing a bit of a tantrum Powell merely restated that the Federal Reserve remains data-dependent and that nothing has been decided when it comes to whether we get 25bps or 50bps.

"The comments helped briefly pull yields lower and pull the US dollar off its highs for the day, but the reality remains that markets are slowly starting to come to the realisation that rates are likely to remain higher for longer and that the terminal rate is also likely to settle at a much higher level."

On the corporate front, Aviva posted a better-than-expected 35% rise in annual operating profit and announced a £300m share buyback, driven by a rise in life and general policy sales.

Profits for 2022 came in at £2.2bn against a company-compiled consensus of £1.75bn and a total dividend of 31p a share was declared, in line with expectations. Aviva upgraded dividend guidance to low-to-mid single digit growth.

Elsewhere, M&G posted a 27% drop in its full-year adjusted operating profits to reach £529m, together with a similar-sized decline in its operating capital generation to £821m.

The investment manager also reported a decline in its Solvency II ratio from 218% for 2021 to 199% in 2022.

However, it recorded a second year of positive net client flows. Management also said that the firm remained on track to achieve its £2.5bn operating capital generation target by 2024.