London pre-open: Stocks to edge up as investors mull US Iran deal withdrawal

London stocks were set to edge up at the open on Wednesday, with oil prices in focus after US President Trump announced that he was pulling out of the Iran nuclear deal.

The FTSE 100 was called to open eight points higher at 7,573.

CMC Markets analyst David Madden said: "The move will see the reintroduction of sanctions on Iran, and the various aspects of its economy, such as energy, insurance and finance could be targeted. Iran is one of the largest suppliers in OPEC, and traders are fearful the sanctions will weigh on global supply. The oil market has been in an upward trend for nearly eleven months, and given the Iranian development it is likely to continue."

Stocks in the US closed little changed on Tuesday following the announcement.

There are no major UK data releases due, with the week's highlights all on Thursday in the form of the Bank of England rate announcement and manufacturing and industrial production figures for March.

In corporate news, Compass Group’s profit rose 4.5% in the first half, driven by growth at the catering company’s North American business. Underlying operating profit rose to £875m from £837m in the six months to the end of March as organic revenue rose 4.8% to £11.5bn. Statutory operating profit fell 2.7% to £853m.

Vodafone has agreed to acquire Liberty Global's operations in Germany, the Czech Republic, Hungary and Romania for an enterprise value of €18.4bn, the telco giant announced on Wednesday.

The company said the deal would provide estimated cost and capex synergies of around €535m per year before integration costs by the fifth year post completion, with an estimated net present value of more than €6bn after integration costs. Estimated revenue synergies were expected to provide a net present value exceeding €1.5bn from cross-selling to the combined customer base.

First-half profits for Imperial Brands fell 7% as tobacco sales fell, currencies swung and UK distributor Palmer & Harvey called in the administrators.

On the upside, the FTSE 100 giant said its sales volumes continued to outperform the industry and it doled out a 10% increase in its interim dividend of 56.87p.

Security group G4S said first-quarter trading was in line with the outlook it provided in March and that it expects growth to accelerate in the second half of the year after organic revenues fell 2% in the first quarter.

Following a major contract win in February, the North America retail cash solutions business has continued to build a large sales pipeline and make "significant" progress with pilot programmes at major retailers, which G4S said provides confidence in its growth prospects.