London pre-open: Stocks seen higher as investors eye Fed meeting
London stocks were set to rise at the open on Tuesday following positive sessions in the US and Asia, as investors eyed the start of the Federal Reserve’s two-day policy meeting.
The FTSE 100 was called to open around 30 points higher.
Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: "The Federal Reserve begins its two-day policy meeting today with soft but not collapsing employment and sales data, softer-than-expected but still near 3% inflation, and a high level of uncertainty and tariff-led volatility in its hands.
"The Fed is expected to maintain its rates unchanged. The dot plot and Powell’s press conference will be closely watched by investors. Economists predict two rate cuts for the remainder of the year, traders see three. Some analysts also think that pausing the QT could be an interesting move for relaxing the financial conditions without touching the rates.
"Powell had said in a recent press conference that the US economy remains on a solid footage - a prediction that’s not shared by Atlanta Fed’s GDPNow forecast that warns that the US economy could shrink by more than 2% in the Q1.
"A dovish Fed outlook supports further dollar depreciation, while a more conservative stance could hurt growth prospects, also weighing on the greenback. The only thing that could revive USD appetite is an explicit signal from the Fed that it’s ready to step in if economic growth faces a serious threat. Voilà. This sets up EUR/USD for a solid shot at clearing the 1.10 resistance, though overbought conditions could hinder a sustained breakout in the short run."
In UK corporate news, IT firm Computacenter posted a fall in annual profits amid an uncertain macroeconomic environment and softer market conditions in the UK, offset by stronger performances in the US and Germany.
Pre-tax profit for calendar 2024 declined by 10% to £244.6m. Gross invoiced income fell 1.6% to £9.9bn.
Trustpilot reported a strong financial and operational performance in its final results, with revenue rising 18% in constant currency to $211m for 2024, and adjusted EBITDA increasing 55% to $24m.
The FTSE 250 firm said bookings grew 21% to $239m, supported by simplified pricing, product innovation and improved customer retention.
Looking ahead, the company said it expected high-teens revenue growth in 2025 and adjusted EBITDA slightly ahead of market expectations.
STEM-focused recruiter SThree held on to its full-year guidance despite a weak first quarter with double-digit declines in fees for both contract and permanent positions.
Group net fees were 15% lower year-on-year in the three months to 28 February, which the company said was consistent with its performance in the fourth quarter, with the bigger contract division (84% of net fees) shrinking 15% and permanent placements down 13%.
"As we look ahead, business leaders are continuing to navigate an evolving macro-economic backdrop which is weighing on investment decisions," said chief executive Timo Lehne.
Sabre Insurance saw its profit more than double in 2024, leading management to hike the motor insurer's dividend payout by 44% to 13.0p.
Profit before tax meanwhile was ahead by 105.9% to £48.6m on an IFRS basis. That saw its return on tangible equity surge by 15.5 percentage points to an annualised rate of 38.2%. The business's combined operating ratio meanwhile fell by 7.4 percentage points to 84.2%.