LONDON (SHARECAST) - City sources predict the FTSE 100 will open up 21 points from yesterday's close of 5,828, boosted by a significant rise in US stocks last night, which were in turn buoyed by positive economic data readings ahead of the September jobs report and following "as-expected" policy decisions this afternoon from the Bank of England (BoE) and the European Central Bank (ECB).
Today all eyes will now be on the monthly jobs report from the Labor Department. Non-farm payrolls are expected to have increased by 111,000 last month, up from the previous gain of 96,000. Meanwhile, the unemployment rate is forecast to rise to 8.2% from 8.1%.
The Footsie swung between gains and losses for most of Thursday’s session, but finished the day broadly flat following a busy day on the global economic calendar, which saw policy decisions in the UK and Europe, and a news conference with Mario Draghi.
At midday yesterday, the Bank of England’s Monetary Policy Committee (MPC) maintained the Bank Rate at 0.5% and the asset purchase programme at £375bn. The decision was more or less as forecast, though many analysts are expecting the Bank to embark on further easing and possibly a rate cut in November.
In company news, broadband and communications provider Kcom has performed in line with expectations in the first half of its fiscal year, but orders in its enterprise division have been a bit below expectations. The ability now to offer bundled services - e.g. phone plus broadband - continues to receive a positive response from the KC division's customers, while Kcom, the group's enterprise business, has delivered year over year growth in its multi-year order backlog, albeit lower than previously anticipated due to the uncertain environment for business investment decision making.
Oilfield services firm Wood Group continues to be confident of hitting full year profit targets, with conditions in energy markets remaining favourable. "We anticipate strong operating cash flow in the second half, and our strong balance sheet provides a robust platform for growth," the group's interim management statement said.
Residential property owner-manager Grainger has announced that it has sold the first phase of its Berewood housing scheme, located west of Waterlooville in South Hampshire, to Bloor Homes which will begin construction next month. Bloor Homes has bought an 11.2 acre site with planning consent for 194 new homes and an end gross development value of around £35m. This sale represents the first of thirteen phases at Berewood, which in total comprises 168 developable acres.
The Questor team at The Independent has labelled recruitment group Robert Walters as a 'hold', after the firm said yesterday that the global economic backdrop is taking its toll on the industry with trading conditions tough in the UK, Europe and the Americas.
While the paper recommends to await further developments and the group's full-year trading update in January, it does highlight decent position despite the gloomy outlook.