London pre-open: Stocks to edge up as election looms

London stocks were set to edge higher at the open on Wednesday, with traders likely to err on the side of caution a day ahead of the general election.

The FTSE 100 was called to open 11 points higher at 7,224.

CMC Markets analyst David Madden said: "The UK general election on Thursday is still very much in focus, and Brexit will be at the heart of the vote. The pro-business Conservative party remains in the lead in the opinion polls, which is why sterling has continued to be in demand. As election day draws near is it likely that volatility will drop-off as traders hunker down."

Trade relations between the US and China were also still in focus as the US is due to slap tariffs on $150bn of Chinese imports on Sunday, although there have been reports this will be deferred.

Madden pointed out that socks sold off in late morning on Tuesday after a report that the US was going to wait for China to make the first move.

"But in classic trade talks form, there was subsequent reports the US were seeking the Chinese government to commit to purchasing agricultural goods. The counter response from China was that any guarantee to buy agricultural goods must tie in with a roll back in tariffs. The major US indices finished slightly lower," he said.

Investors will also be eyeing the latest policy announcement from the Federal Reserve, due after the European close.

In UK corporate news, Energy investor Riverstone International said it was selling all offshore Gulf of Mexico assets owned by affiliates of Castex Energy to Talos Energy for an undisclosed sum.

The company added that it was also selling all of the undrilled primary term acreage and prospects of ILX Holdings III to Talos for non-material consideration. Riverstone owns 25.1% of Castex 2014 and 33.3% of ILX III and has invested $52m and $155m in the companies respectively.

The net purchase price at closing of the two sales was is expected to be funded through the issue of new Talos shares and cash from existing sources of liquidity, Riverston said in a statement.

Interim profits and revenue at transport operator Stagecoach fell reflecting the loss of its East Coast and East Midlands train franchises.

Revenue from continuing operations fell to £800.2 from £1bn. Adjusted total operating profit from continuing operations fell to £79.6m from £87.5m, as weaker UK bus profits also took their toll, the company said.

Stagecoach added that Ray O'Toole would succeed company founder Brian Souter as chairman from January 1, while co-founder Ann Gloag and Ewan Brown would step down as non-executive directors on December 31.

IG Group has appointed former Betfair and Ofcom director Robert Michael McTighe to take over from Jonathan Moulds as board chairman, with McTighe set to take up his position on 3 February 2020.

Interim chairman Jonathan Moulds said: "Mike brings impressive board and leadership experience in financial services and other regulated sectors, and we look forward to benefiting from his considerable stakeholder management skills."