London pre-open: Stocks seen higher as attention turns to Draghi

London stocks were set for a positive open on Thursday as investors eyed a rate decision by the European Central Bank and ensuing press conference with Mario Draghi.

The FTSE 100 was expected to open 16 points higher at 7,463.

CMC Markets analyst Michael Hewson said: “The pound saw a reversal of fortune and a nice rebound yesterday after the weakness of Tuesday as a better than expected Q3 GDP number of 0.4% put aside concerns that the Bank of England might get cold feet at next week’s rate meeting about pushing bank rate back to 0.5%, and back to where it had been before last year’s August rate cut.

“We do still have a week to go until next week’s meeting with more economic data due out between now and then, but a weak number yesterday would have made it much harder to justify pulling the trigger on a move next week.”

Hewson pointed out that markets are now pricing in an 89% probability of a rate hike next week.

For Thursday, however, it will be all eyes on Frankfurt and the latest press conference of ECB President Mario Draghi.

“No changes are expected to be made to monetary policy at this meeting, however there has been persistent speculation as to what measures the ECB governing council might look to take with respect to the amount and duration of their €60bn asset purchase program which most people expect to be pared back at the end of this year,” Hewson said.

On the UK data front, the CBI distributive trades survey is at 1100 BST.

In corporate news, third-quarter profits at Barclays were lower than expected as its investment banking business faced difficult markets but an improvement in the UK bank and the consumer credit arm. Pre-tax profit of £1.11bn was short of the consensus forecast of £1.43bn

Information and analytics company Relx Group reported continued underlying revenue growth in the first nine months of 2017 in a trading update on Thursday, and reaffirmed its outlook for the full year.

The company said underlying revenue growth was 4% in the first nine months of 2017, after it acquired six assets for £118m total in the year-to-date, and disposed of assets for £78m.

Rare disease specialist Shire announced that the European Commission has approved a label extension granting a new indication for FIRAZYR (icatibant injection), broadening its use to adolescents and children aged two years and older, with hereditary angioedema (HAE) caused by C1-esterase-inhibitor (C1-INH) deficiency.

The company’s FIRAZYR has been approved in the European Union since 2008 for the symptomatic treatment of acute attacks of HAE in adults with C1-INH deficiency.