London pre-open: Stocks seen lower after Wall Street selloff
London stocks looked set for a downbeat open on Tuesday, taking their cue from weak US and Asian session as investors continued to eye any Brexit-related developments.
The FTSE 100 was called to open seven points lower at 6,993.
Overnight, US stocks fell sharply, with the Dow down nearly 400 points and the Nasdaq 219 points lower as tech giants Apple, Amazon and Facebook slumped.
"An almost 4% slide in Apple and a selloff in semiconductor makers led the decline in tech stocks, pulling US indices lower," said London Capital Group analyst Jasper Lawler. "Concerns over iPhone demand and fears that chipmakers would be caught up in the US-China trade war weighed heavily on demand.
"The tech selloff and trade war concerns dragged Asian stocks lower overnight and European bourses are pointing to a charge lower when the opening bell rings."
Lawler pointed out that traders were quick to jump out of Apple on reports that the company has slashed production orders in recent weeks for all three iPhone models that were unveiled in September.
"Investors had been nervous about the outlook for Apple and its flagship devices since the firm announced that it would no longer be reporting a breakdown of sales figures by product in its most recent earnings update. News of slashed production orders has just confirmed those fears, forcing investors to reassess Apple’s outlook," he said.
On home shores, the focus was on politics as it appeared that the threshold of 48 letters needed to trigger a vote of no confidence in Prime Minister Theresa May still had not been reached.
On the UK data front, the CBI industrial trends survey for November is at 1100 GMT. Before that, market participants will watch out for a speech by Bank of England governor Mark Carney and the Inflation Report hearings.
In corporate news, EasyJet's profits soared more than 41% in the past 12 months but it sees potential for greater growth by expanding its holiday business.
The budget airline reported headline profit before tax for year ending 30 September of £578m as revenues grew 17% to £5.9bn.
Thread maker Coats said group sales for the four months to end October grew 3% on a constant exchange rate basis, with increasing momentum in the industrial division, which was up 9%.
On an organic basis, group sales were flat with industrial up 5% and continuing to perform strongly. Coats said full year trading results would be in line with expectations.
Building materials group CRH updated the market on its trading for the nine months ended 30 September, reporting a nine-month EBITDA of €2.5bn, which was 8% ahead of 2017 or 2% higher on a like-for-like basis.
The company said it saw continued underlying growth in the Americas, despite adverse weather conditions in certain markets, as momentum remained positive in Europe, and demand improved in Asia. Total 2018 EBITDA was expected to be approximately €3.35bn.