London pre-open: Stocks to edge up after inflation figures

London stocks were set to edge up at the open on Wednesday following losses in the previous session, as investors digest the latest UK inflation figures.

The FTSE 100 was called to open 12 points higher at 6,088.

Figures out earlier from the Office for National Statistics showed that consumer price inflation rose to 1% in July from 0.6% the month before as lockdown measured eased.

ONS deputy national statistician for Economic Statistics, Jonathan Athow, said: "Inflation has risen, in part, due to the largest monthly pump price increase in nearly a decade, as international oil prices rose from their lows earlier this year.

"The largest upward movement came from clothing where prices fell on the month but by less than a year ago, partly due to different sales patterns throughout the year so far.

"In addition, prices for private dental treatment, physiotherapy and haircuts have increased with the need for PPE contributing to costs for these businesses.

"Our new experimental numbers, taking into account changing spending patterns throughout the pandemic, show prices rising only a little higher than our headline inflation figures."

In corporate news, South America-focused miner Hochschild reported a sharp fall in profits as operations were shuttered during the coronavirus lockdown.

Adjusted core earnings almost halved to $80.65m as revenue fell to $232m from $354m a year ago, despite higher gold and metal prices.Hochschild said it hoped to cash in on record commodities prices in the second half “provided our people are able to operate safely and experience less disruption”.

IT infrastructure company Softcat said that it continued to trade “satisfactorily” during the final three months of its financial year, and delivered operating profit for the full year “slightly ahead” of its own expectations.

The FTSE 250 company said cash generation also remained strong through to the year-end on 31 July, adding that it now intended to resume its normal dividend policy and timetable later in the year.

That would include payment of the interim dividend previously cancelled in March, the board confirmed.