LONDON MARKET EARLY CALL: Stocks Seen Higher Ahead Of UK GDP

LONDON (Alliance News) - Stock prices in London are seen opening higher on Monday, tracking gains ...

Alliance News 11 February, 2019 | 7:01AM
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LONDON (Alliance News) - Stock prices in London are seen opening higher on Monday, tracking gains in Asian markets, with the fourth quarter UK GDP reading to come in the morning.

IG futures indicate the FTSE 100 index is to open 36.52 points higher at 7,107.70. The blue chip index closed down 0.3%, or 22.40 points at 7,071.18 on Friday.

In China, the Shanghai Composite is up 1.0%. Financial markets in China reopened after being closed for the Lunar New Year holiday last week. The Hang Seng index in Hong Kong is up 0.3%.

Financial markets in Japan are closed for the National Foundation Day holiday.

The economic calendar events calendar has UK GDP and industrial and manufacturing figures at 0930 GMT.

The pound was flat against the dollar, quoted at USD1.2936 from USD1.2937 at the London equities close Friday.

"Kicking off with UK GDP this morning, the expectation is for economic growth to have completely stalled quarter on quarter. This comes just days after the Bank of England downwardly revised economic growth for the UK to just 1.2% across this year last week," said London Capital Group's Jasper Lawler.

Meanwhile, UK Prime Minister Theresa May has offered further talks with the opposition Labour party in an attempt to secure cross-party support for a Brexit deal.

May questioned Labour leader Jeremy Corbyn's key call for the UK to remain in a customs union with Brussels but offered concessions in other areas and said she wanted talks between Labour and Tory teams "as soon as possible".

Her offer came as Brexit Secretary Stephen Barclay prepared for talks with EU chief negotiator Michel Barnier as the government stepped up efforts to secure changes to the Irish backstop measure in the Withdrawal Agreement.

In her letter to Corbyn, responding to the conditions for a Brexit deal set out by the Labour leader, the prime minister said she wanted the Tory and Labour teams to consider "alternative arrangements" to the Irish backstop.

In the US on Friday, Wall Street ended mixed, with the Dow Jones Industrial Average down 0.3%, S&P 500 and Nasdaq Composite both ending 0.1% higher.

Investors will look ahead to the next round of US-China trade talks to be held in Beijing later this week.

"Trade talks between the two largest economies continue to be the primary focus for investors, with the narrative around the success of them appearing to change week by week. The prospects for a deal now look very slim, with the best case scenario now looking like an extension of the deadline and a commitment to no more tariffs during that period. Of course, assuming anything when President Donald Trump is involved isn't wise and, well you know the rest," said Oanda senior market analyst Craig Erlam.

The UK corporate calendar on Monday has full-year results from gold miner Acacia Mining. Ahead this week there are annual results from paper and packaging firm Smurfit Kappa on Wednesday, drugmaker AstraZeneca on Thursday, and state-backed lender Royal Bank of Scotland on Friday.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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