LONDON MARKET EARLY CALL: Higher Call Amid US-China Talks Optimism

LONDON (Alliance News) - Stock prices in London are seen opening slightly higher on Tuesday amid ...

Alliance News 12 February, 2019 | 7:00AM
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LONDON (Alliance News) - Stock prices in London are seen opening slightly higher on Tuesday amid optimism that upcoming talks between the US and China will help to resolve their trade dispute.

IG futures indicate the FTSE 100 index is to open 16.79 points higher at 7,145.90. The blue-chip index closed 57.93 points higher, or 0.8%, at 7,129.11 Monday.

Negotiators from the two countries are meeting this week in Beijing, with White House adviser Kellyanne Conway saying President Donald Trump wants to meet Chinese President Xi Jinping very soon.

Two days of high-level talks starting Thursday would involve US Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He.

The Japanese Nikkei 225 index ended up 2.6%. Financial markets in Japan reopened after being closed for the National Foundation Day holiday on Monday.

In China, the Shanghai Composite is up 0.3%, while the Hang Seng index in Hong Kong is flat.

"This cautious optimism appears to be permeating into Asia markets, with the Nikkei rising sharply as Japanese investors return from their long weekend, however the mood remains tentative, with markets in Europe set to open slightly higher," said CMC Markets chief market analyst Michael Hewson.

The pound was flat, quoted at USD1.2867 against USD1.2864 at the London equities close Monday.

In UK political news, a cabinet minister has insisted there is "no chance" of Theresa May accepting Labour's vision for leaving the EU, despite speculation she could soften her stance on customs union membership.

As May prepares to update MPs on the latest developments in the Brexit negotiations on Tuesday afternoon - a day earlier than expected - Andrea Leadsom dismissed the prospect of May adopting Jeremy Corbyn's "world view".

In an exclusive interview with the Press Association, the Commons leader insisted she would stay in the Cabinet to help May deliver Brexit and denied that the PM was softening her stance over a customs union in a letter to Corbyn.

May's reply sparked concern among Conservative Brexiteers that the PM could concede too much ground to Labour in an attempt to win cross-party backing for a deal with Brussels.

In the US on Monday, Wall Street ended mixed, with the Dow Jones Industrial Average down 0.2%, S&P 500 and Nasdaq Composite both ending 0.1% lower.

The UK corporate calendar has full year results from online trading company Plus500 and a trading statement from roadside assistance provider AA.

Already out, TUI Group reported a significantly widened first-quarter loss, having under a week ago warned on full-year earnings.

The Anglo-German travel firm's pretax loss for the three months to December stood at EUR135.0 million, versus EUR84.3 million loss the same period a year prior.

Revenue did increase, however, by 4.4% year-on-year to EUR3.70 billion.

This performance, TUI said, met expectations after a "record" previous financial year. First quarter revenue, and volumes, have grown, but margins have slipped.

"The main reasons for the decline in earnings included the unusually long and hot summer in Northern Europe," said TUI.

The economic events calendar has South Africa unemployment data at 0930 GMT. Bank of England Governor Mark Carney will give a speech relating to "the latest developments in the global economy and risks to the outlook" in London at 1300 GMT.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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