London pre-open: Stocks to rise after heavy losses; jobs data in focus
London stocks were set to rise at the open on Tuesday following heavy losses in the previous session, as investors digest the latest UK jobs data.
The FTSE 100 was called to open 40 points higher at 7,245.
CMC Markets analyst Michael Hewson said: "The fallout from Friday's US inflation number continued yesterday with more sharp falls in global equity markets, sending the S&P 500 and Nasdaq 100 into bear market territory, and below their previous lows this year.
"The US dollar also picked up where it left off on Friday, surging to a new 20 year high against a basket of currencies, while across the board yields rose sharply. The US yield curve inverted further, with the 5-year yield moving sharply above the 30-year yield signalling a rising concern that the US economy is heading towards a possible recession.
"Asia markets also fell again this morning, however today’s European open looks set to see a modest rebound as selling pressure starts to subside a little."
Data released earlier by the Office for National Statistics showed the unemployment rate rose to 3.8% in the three months to April from 3.7% in the previous quarter.
The number of people on payrolls rose by 90,000 in May to a fresh record high of 29.6m and the number of job vacancies in March to May hit a new record high of 1.3m.
In corporate news, equipment rental company Ashtead said it had delivered a record full-year, with both revenue and profits up following a solid fourth-quarter showing.
Ashtead said full-year revenues were up 19% at $7.96bn, with annual rental revenues 24% stronger at $7.23bn. Underlying earnings were 18% higher over the twelve months ended 30 April at $3.60bn, while operating profits were up 30% at $1.94bn and adjusted pre-tax profits rose 38% to $1.82bn.
Rail and bus operator FirstGroup, which last week rejected a £1.23bn takeover approach, reported higher adjusted operating profits as travel recovered from the Covid pandemic.
The company posted profits of £226m compared with £220m a year ago for the year to March 26. Revenues fell to £5.5bn from £6.8bn, reflecting the sale of First Student, First Transit and Greyhound bus services.