London pre-open: FTSE 100 seen edging higher on US dollar weakness

Traders were expected to nudge the top flight index higher on the back of a further dip in the US dollar, amid positive news on the geopolitical front.

The FTSE 100 was being called to start the session 19 points higher at 7,530 as the US dollar index slipped 0.14% to 93.41 points.

Commenting on Monday's market backdrop, CMC Markets UK's chief market analyst, Michael Hewson, said: "The wider question with respect to Friday’s rebound is whether it will materially alter sentiment surrounding the US dollar which has gone from being overwhelmingly bullish at the beginning of the year to overwhelmingly bearish in a short space of time.

"This heavy bias towards the downside could result in a squeeze of US dollar short positions and prompt some relief for European equity markets over the next few days, however it is unlikely to change the longer term direction for the US dollar, which unless the Trump administration gets its act together, could well have further to fall."

At the weekened, the United Nations slapped fresh sanctions on Pyongyang which might reduce the country's export earnings by a third.

In parallel, foreign ministers of the ASEAN group of nations reached agreement on a framework to negotiate a code of conduct in the South China Sea, although some market commentary described the news as a 'stalling' tactic on the part of Beijing.

On the domestic front, no major UK data releases are scheduled for Monday.

However, The Sunday Telegraph reported that Westminster was leaning towards paying a £36bn (€40bn) divorce bill as the price of leaving the European Union.

It would reportedly be paid in three yearly tranches of €10bn after the UK left the bloc in March 2019, with the remaining amount to be finalised alongside detailed trade talks.

In the States, the spotlight will be on Fedspeak, with St.Louis Fed chief James Bullard set to deliver a speech at 1500 BST, followed by his counterpart at the Minneapolis Fed, Neel Kashkari, at 1925 BST.

Defence specialist sees 2017 weighted towards backhalf

Ultra Electronics's top and bottom lines were little changed at the half-year stage, but the company sounded a confident note on the full-year outlook, pointing to a "strong" order intake during the final part of the reporting period. Over the six months ending on 30 June, the defence and security electronics specialist saw revenues dip by 0.1% to £366.4m, which led to a 0.2% fall in its underlying profits before tax to £52.3m. However, the company's book-to-bill ratio rose slightly, by 1.5% to 1.07 with company boss Rakesh Sharma saying that the board was "pleased" with its current order position.

Betting group Paddy Power Betfair said interim revenue growth would be up 9% and underlying EBITDA up 21% when it reports on Tuesday, adding that Breon Corcoran would be stepping down as CEO after 16 years in the job. It will also confirm that trading is in line with expectations and provide guidance for full year 2017 underlying EBITDA, including the impact of the acquisition of DRAFT, of between £445m and £465m.

Health and safety group Halma has completed two overseas acquisitions in its medical business for the equivalent of £12.1m and £3.4m. The larger is Cardios, a Brazilian specialist in ambulatory blood pressure monitoring, while the other purchase was of a range of non-invasive blood pressure devices.

NewRiver REIT announced on Monday that its chief executive David Lockhart would shortly be undergoing an elective procedure that will require him taking a leave of absence. The FTSE 250 firm’s board said that during that time, the day-to-day executive responsibilities of the company would be shared between the company’s property director Allan Lockhart and its chief financial officer Mark Davies.