London pre-open: Stocks to edge up ahead of jobs data; Brexit developments eyed
London stocks were set to nudge up at the open on Tuesday as investors focus on Brexit developments and a series of key UK jobs data.
The FTSE 100 was called to open three points higher at 7,032.
The UK's divorce from the EU was very much in focus after Prime Minister Theresa said on Monday that a Brexit deal now looks unlikely until December, as it may take "weeks" to break the deadlock in talks.
London Capital Group analyst Jasper Lawler said: "As Theresa May plays for time rather than bulldozing a Brexit treaty through, the pound is in limbo. Important issues remain unresolved in Brexit negotiations and a solution won’t be found before the EU summit in Brussels on Wednesday.
"The clocks have been pushed back not to just November, but now even to December as the can is once again kicked down the road. There is a growing sense that the Irish border issue won’t be resolved; in the words of the EU Commissioner a no deal Brexit is more likely than ever before."
On the data front, the ILO unemployment rate, claimant count and average earnings are all due at 0930 BST. Unemployment is expected to remain constant in August at 4%, while weekly earnings are expected to be unchanged at 2.9% for the three months to August.
"It will take a significant beat to the upside to inject some optimism into the pound. On the other hand, any weakness in the figures could drag on the pound given the downside risks of Brexit already making the pound sensitive," said Lawler.
In corporate news, British American Tobacco said it expected to grow earnings in double figures for the full year, helped by market share gains and a stronger tobacco pricing mix.
The FTSE 100 company said its global vapour business was on course to deliver double digit volume and constant currency revenue growth in 2018.
FTSE 250 housebuilder Bellway reported a rise in full-year profit and revenue as completions breached the 10,000 mark for the first time.
In an update for the year to the end of July, the company said pre-tax profit rose 14.3% to £641.1m on revenue of £2.96bn, up 15.6% on the previous year.
Drax said it was buying Scottish Power's portfolio of pumped storage, hydro and gas-fired generation for £702m from parent company Iberdrola.
The Portfolio is expected, based on recent power and commodity prices, to generate EBITDA in a range of £90m-£110m from gross profits of £155m to £175m.
BHP said it had spent £45.6m to lift its stake in SolGold, which owns the Cascabel copper-gold project in Ecuador.
The mining giant took an initial 6% stake in SolGold six weeks ago and now has 11.2%.
Under the deal, BHP will buy 100m new shares in the company at 45p, a 32% premium to the stock’s last close.