London pre-open: FTSE to glide higher after Chinese data, CBI report

UK stocks are expected to kick off the week with modest gains as investors digest the latest data out from China over the weekend alongside an upbeat forecast for the British economy from CBI.

City sources predict the FTSE 100 will open around 15 points higher than Friday's close of 6,567.24.

Data out from China showed that imports were once again weak, while exports offered what one analyst called an "unreliable" picture. Inflation came in unchanged, but producer prices plunged.

"The trade balance figures for October don't appear to have altered anyone's view on the state of the economy, although given renewed speculation recently regarding false invoicing in China, this may just reflect a lack of trust in the numbers," observed Alpari market analyst Craig Erlam.

"Exports fell to 11.6% last month from 15.3% in October, which may ordinarily have been a cause for concern, but given the inconsistencies in the data recently, it's very difficult to determine whether the exports figures are actually accurate or not and without that, how can we make an assessment of them. The fall in imports to 4.6% is a little concerning, although weaker commodity prices are likely to once again be the biggest driver of this."

Meanwhile, a report out from the Confederation of British Industry (CBI) revealed that the economic recovery is expected to continue over the next two years, which would see average wage rises for workers across all professions above inflation in both 2015 and 2016.

The business lobby predicts economic growth of 3% this year, with a drop to 2.5% in the next two years.

However, the problems faced by the Eurozone could affect British exports, the confederation warned.

In company news, shopping centre owner Hammerson said that conditions in the UK retail market have improved since the half-year stage, but are still subdued in France. The company, which owns the Bullring shopping centre in Birmingham and Brent Cross in London, said long-term leases were achieved 9% above estimated rental value (ERV) across the group and 8.5% ahead of previous passing rents. Retail leases were struck 15% above ERV in the UK, but just 1% above ERV in France.

Engineering data and design IT systems provider Aveva saw revenues decline 21% over the six months ended 30 September to reach £85.9m. That was in line with the revised guidance provided by the company in its mid-September trading update. The company attributed the decline to the “material strengthening” of sterling.

Bodycote, the world's largest thermal processing services provider, has signed an eight-year agreement with Messier-Bugatti-Dowty, also known as Safran Group, to provide thermal spray coating services for major commercial and military airframe component programmes, including the Boeing 787 and Airbus A350. Thermal spray coatings are used to prolong the working life of critical components and provide in-service protection from factors such as abrasion, temperature and wear.