London pre-open: Stocks seen up as investors mull borrowing figures

London stocks were set for a firmer open on Tuesday following positive sessions in the US and Asia.

The FTSE 100 was called to open 12 points higher at 7,064.

Investors were digesting the latest figures from the Office for National Statistics, which showed that public sector borrowing was £31.7bn in April, down £15.6bn from the same month last year.

This marked the first annual drop since the start of the pandemic, although borrowing remains at elevated levels.

Capital Economics said: "April’s public finances figures showed that the government’s financial position isn’t as bad as the Office for Budget Responsibility (OBR) predicted only two months ago, reinforcing our view that the tax hikes and spending cuts that most fear may be avoided."

In corporate news, Wagamama owner Restaurant Group said it had seen an encouraging recovery in sales since Covid-19 restrictions had been lifted.

In the five weeks to May 16 around 130 Wagamama sites were open and traded at circa 85% of comparable 2019 sales levels, representing a 15% outperformance of the market and “reflecting ongoing strong delivery volumes and good trading from outdoor space in many locations”.

"The group currently has approximately 350 sites open across its Wagamama, pubs and leisure businesses, representing 95% of their respective combined estates. The concessions business currently only has four sites trading, given restrictions regarding international travel," the company said.