London pre-open: Stocks to edge higher as traders continue to mull payrolls

London stocks were set to edge just a touch higher at the open on Monday as investors continue to mull last week’s non-farm payrolls miss.

The FTSE 100 was called to open up seven points at 7,145, with trade set to be quieter than usual as US markets will be closed for Labour Day.

CMC Markets analyst Michael Hewson said: "Asia markets have started the week on the front foot with the Nikkei 225 continuing its big rise on Friday with another positive session. The resignation of Japanese PM Yoshihide Suga, now sets the wheels in motion for an election by the end of the year, after his popularity plunged as a result of the government's shambolic Covid-19 response.

"His departure also opens up the prospect that a new leader will embark on a new stimulus program, with one of the main challengers and front runner Fumio Kishida pledging a new program of measures worth trillions of yen. With the Nikkei 225 hitting a four-month high as a result of Friday’s sugar rush, and US markets out for a bank holiday European markets look set to pick up where they finished off last week."

On the macro front, Markit’s UK construction PMI for August is due out at 0930 BST. It’s expected to show a slowdown to 56.0 from 58.7 in July.

In corporate news, veterinary drug maker Dechra Pharmaceuticals reported a surge in profits and lifted its dividend as people spent more on pet welfare during Covid-19 lockdowns.

The company said underlying operating profit increased by 29.2% to £162.2m on the back of revenue growth of 21.0% to £608.0m. The full-year dividend rose 18.1% to 40.50p a share.