London pre-open: Stocks to edge up as investors mull China data

London stocks were set to edge up at the open on Tuesday as investors mull the latest data out of China.

The FTSE 100 was called to open 10 points higher at 7,158.

Oanda analyst Jeffrey Halley said the Chinese PMIs released earlier disappointed.

"China's Manufacturing PMI clung on to expansionary territory, slightly underperforming at 50.1. However, it was the non-manufacturing PMI that surprised, tumbling from 53.3 to 47.5 for August, well into contractionary territory," he said.

"Several factors are at work here. Covid-19 lockdowns in various cities and critical ports sapped domestic consumption, and consumers postponed travel as a result.

"However, it is likely that the ongoing government clampdowns in multiple sectors, notably student tuition and technology, are impacting both employment concerns in those affected and broader consumer confidence as fears of wider interventions rise. The latter is a fair point, with China announcing more limits on online game time for children and investigating brokerage margin policies."

In corporate news, SK Bioscience (SK) and GlaxoSmithKline said they would start a phase 3 clinical study of SK’s Covid-19 vaccine candidate after positive phase 1 & 2 trials.

The randomised, active-controlled global trial will enrol around 4,000 participants from a range of countries and will aim to evaluate GBP510’s safety and immunogenicity compared to the AstraZeneca/Oxford University Covid-19 vaccine.

Results from the Phase 3 study are expected in the first half of 2022 after which, subject to positive results and regulatory approval, the vaccine is expected to be supplied at scale worldwide through the COVAX facility.

Bunzl reported first-half adjusted profit up almost 15% as a recovery in its core business more than offset declining sales of Covid-19 related products.

Adjusted operating profit for the six months to the end of June rose 14.7% at constant currency to £366.8m as constant currency revenue increased 6.3% to £4.87bn. Pre-tax profit rose 12.3% to £275.7m as reported revenue rose 0.4%.