London pre-open: Stocks to drop as US tech giants fail to impress

London stocks were set to drop at the open on Friday, taking their cue from a downbeat session in Asia as earnings from US tech giants failed to impress

The FTSE 100 was called to open 64 points lower at 6,940.

CMC Markets analyst David Madden said: "We heard from tech giants Amazon and Alphabet after the closing bell last night. Amazon topped the earnings per share forecast, but missed on revenue and the guidance. Google’s parent, Alphabet, exceeded estimates on EPS, but undershot the revenue forecast.

"Both stocks dropped heavily in the post-market session, and in turn sparked selling across major US indices. Asian stock markets have been dragged lower by the sharp decline in US index futures."

There are no major UK data releases but in the US, third-quarter gross domestic product will be eyed at 1330 BST. Economists expect a reading of 3.3%, which would be a slowdown from 4.2% growth in the second quarter.

In UK corporate news, Royal Bank of Scotland increased profits in the third quarter but operating margins continued to be squeezed by competitive pressures.

Attributable profit of £448m in the three months to 30 September was up 14.3% on the same period last year and up almost fivefold from the second quarter of this year.

International Consolidated Airlines Group issued its group consolidated results for the nine months ended 30 September, reporting third quarter operating profit €1.46bn, up from a restated €1.45bn last year.

The FTSE 100 airline operator, which owns British Airways, Iberia, Aer Lingus, Level and Vueling, said it saw an adverse net foreign exchange operating profit impact for the quarter of €111m, while passenger unit revenue for the quarter was up 1.3%, or 2.4% at constant currency. Operating profit before exceptional items for the full nine month period was ahead 7.3% year-on-year at €2.58bn.

Mining conglomerate Glencore said third quarter own-sourced copper production increased 12% to 1.06m tonnes while own-sourced cobalt production was up 44% to 28,500 tonnes.

Coal production rose 6% to 96.7m tonnes, reflecting the acquisition of interests in the HVO and Hail Creek mines in Australia in May and August 2018 respectively and the recovery in Australia from weather-related disruption and industrial action in 2017.