London pre-open: Stocks seen lower as oil skids on failed Doha meeting

London stocks were set to open lower on Monday as oil prices slid in the wake of the failed Doha meeting over the weekend.

The FTSE 100 was seen starting 64 points lower than Friday’s close at 6,279.

“A failed attempt to agree an output freeze by some of the world’s largest oil producers in Doha over the weekend has sent oil prices tumbling at the start of the week, which in turn appears to be weighing on European futures as we approach the open,” said Craig Erlam, senior market analyst at Oanda.

“The inability of the other oil producers to even agree on a loose commitment to freeze output for now says a lot I think. With this now seemingly off the table, at least until the next OPEC meeting in June and probably beyond, I struggle to see what could continue to support oil prices at these levels, even taking into consideration the considerable sell-off overnight.”

There are no major UK data on Monday but later in the week, investors will eye the release of the UK unemployment rate and retail sales.

Centrica to axe 3,000 jobs

Centrica said it expected to axe 3,000 jobs in 2016 as part of its cost cutting plans, with 800 to go in the first quarter.

In a trading statement, the company said UK Home energy supply accounts were down 1.5% in the first quarter primarily as a result of significant long term contracts roll-off.

It said there were “propositions” planned for launch in the second quarter and the third gas price reduction since the start of 2015 kicked in on 6 March.

Centrica said debt would be cut to £4.4bn in the first quarter, benefiting from strong working capital management and seasonal phasing of cash flows.

It added that £200m of efficiency savings were expected to be delivered in 2016 as part of the group’s £750m annual cost efficiency programme, with like-for-like operating costs expected to be lower in 2016 than in 2015.

Consumer products firm Reckitt Benckiser described its first quarter as “good” on Monday, despite a number of challenging trading conditions, with sales growing 5% on a like-for-like basis and 4% on an actual basis to £2.3bn.

The FTSE 100 group said the results were in line with its full-year targets, with Europe and Australia/New Zealand “strong”, while the US and Russia were impacted by retailer de-stocking due to the weaker flu season.

Revenue was up 3% on a like-for-like basis in Europe and North America, including Australia/New Zealand, while developing markets were up 10% on a like-for-like basis, and food grew 2%.