London pre-open: Stocks seen lower amid Covid worries

London stocks were set to fall at the open on Monday despite a solid session in Asia, as worries about Covid-19 weigh on sentiment.

The FTSE 100 was called to open 25 points lower at 7,096, with traders likely to be nursing a sore head after England’s Euros defeat overnight.

CMC Markets analyst Michael Hewson said: "Last week’s events appear to paint a narrative of some concern that the reflation trade is either in trouble, or merely being delayed, due to concern over rising Delta variant cases in Asia, which has prompted a number of countries including Japan, South Korea and Australia to reimpose tighter restrictions.

"We’re also seeing higher case counts in the UK, US and Europe, which could also add to the uncertainty, although in the case of the UK the high levels of vaccination are keeping hospitalisations and deaths low for now. Whether that stays the case remains to be seen, but the lower vaccination rate in Europe could prove problematic in the days ahead, which mean help explain this morning’s weaker European open."

In corporate news, insurance company Admiral said it expected a higher-than-expected first-half profit due to an “unusually positive” development in the cost of UK motor injury claims.

The firm guided for pre-tax profit of £450m to £500m and a dividend of 110p to 125p a share.

"The stronger result is due to unusually positive development in the cost of UK motor bodily injury claims from a number of prior underwriting years which has led to higher reserve releases and profit commission revenue," Admiral said in a statement.