London pre-open: Stocks to edge up ahead of retail sales data

London stocks were set to edge up a little at the open on Thursday as investors mulled hawkish minutes from the Federal Reserve and eyed the latest UK retail sales data.

The FTSE 100 was called to open six points higher at 7,060.

Investors in Europe will be digesting the latest minutes from the Federal Reserve out late on Wednesday, which showed members were broadly in agreement about the need to lift borrowing costs.

"Whilst the minutes were always expected to have a hawkish slant, the Fed leaning towards more rate hikes moving forwards, made an already jittery market more nervous," said London Capital Group analyst Jasper Lawler, noting that US indices sank following the release, although they did close off their lows.

Closer to home, Brexit was still the big focus, with the pound down 0.3% against the dollar at 1.3080 after Theresa May said she was willing to consider extending the transition period. This would mean keeping the UK tied to the EU until beyond the originally planned 2020 deadline.

"Eurosceptics argue that this will keep the UK like a vasal state, observing EU laws without any vote or representation. On the other hand, it could give the EU and the UK time to find a solution to the Irish backstop issue," said Lawler.

On the data front, retail sales at 0930 BST are expected to show a drop of 0.4% on the month in September, down from a 0.3% increase in August.

"After a strong summer of spending from the UK consumer, and a surprise to the upside in August, there is a good chance the UK consumer is reining in their spending ahead of the Christmas period. According to the BRC the usual back to school shop has not been as supportive as it has in previous years. A larger than forecast decline in retail sales could see the Brexit battered pound take another hit," said Lawler.

In corporate news, Unilever reported an acceleration in underlying sales growth for the third quarter but not as much as the market was expecting.

Underlying sales grew 3.8%, with volume 2.4% and price 1.4%.

Third quarter ongoing revenue at pest control group Rentokil increased by 11.8% to £637.4m at constant exchange rates.

The company said 4.1% was organic revenue growth and 7.7% from acquisitions. Adjusting for the impact of Hurricane Irma on Rentokil's operations in Puerto Rico in September 2017, group organic growth was 4.4%.

Intu Properties updated the market on its leasing activity on Thursday, reporting that Mazda, Shortlist Media, Monki, Oliver Bonas and Typo were among some of the brands to sign new leases with the owner and manager of UK and Spain shopping centres.

The FTSE 250 firm said highlights from its latest leasing snapshot, covering the period from August, included new openings for Debenhams - anchoring the £180m intu Watford extension and featuring the department store's first ‘Beauty Hall of the Future’ concept - with 24 new brands and two dining options.