London pre-open: Stocks to edge lower after downbeat Asian session

London stocks were set to nudge lower at the open Thursday following a downbeat session in Asia.

The FTSE 100 was called to open six points lower at 7,285.

CMC Markets analyst Michael Hewson said: "Today’s European open looks set up for a cautious start, with Asia markets trading softer, although the Nikkei 225 has pulled up sharply from its lows on reports that Japan’s latest fiscal stimulus package will be in a huge 55.7trn yen, or around $484bn. This would be on top of the over 80trn yen already spent since the beginning of 2020.

"The fragmented nature of some of the moves we are seeing appears to suggest that while investors are encouraged in some part by the ability of companies to absorb some of the increases being seen through their supply chains, there is rising uneasiness about how long they will be able to do so."

In corporate news, gambling software maker Playtech confirmed it has received an approach from the JKO consortium that includes former Formula One team owner Eddie Jordan about a potential bid.

It is the third approach is the after Gopher Investments expressed an interest in Playtech a couple of days after it accepted Aristocrat Leisure £2.1bn offer.

"JKO Play Limited seeking access to certain due diligence information, in order to explore terms on which an offer for all of the issued and to be issued share capital of Playtech might be made," Playtech said.

Royal Mail said it would return £400m of cash to shareholders as the delivery service swung to a statutory profit in the first half of the year.

Operating profit for the six months to 26 September was £311m compared with a £20m loss a year earlier as revenue rose 7.3% to £6.07bn. Pre-tax profit rose to £315m from £17m.Royal Mail declared an interim dividend of 6.7p a share and said it would pay out £200m in a special dividend. The company also said it would start a £200m share buyback immediately.

The company said its Royal Mail division would post an adjusted operating profit of about £500m for the full year. Profit by that measure was £235m in the first half.

Investec reported a 30.5% jump in first-half revenue, which it put down to the strength of its client franchises and improved market conditions, while adjusted earnings per share increased 134.8% to 26.3p, ahead of comparable pre-Covid-19 levels two years ago.

The board of the FTSE 250 company proposed an interim dividend of 11.0p, up from 5.5p year-on-year and resulting in a payout ratio of 41.8%, and said it had also resolved to distribute a 15% holding in Ninety One to shareholders.