London pre-open: Stocks to nudge up ahead of Powell speech
London stocks were set to nudge up at the open on Thursday as investors eyed a speech by Federal Reserve chairman Jerome Powell at the Jackson Hole banking symposium.
The FTSE 100 was called to open five points higher at 6,050.
CMC Markets analyst Michael Hewson said: "A fairly decent set of US durable goods numbers for July, helped underpin the positive mood, and looks set to see some positive spill over to markets here in Europe, ahead of today’s keenly anticipated speech by Fed chair Jay Powell, where there is some speculation that he could well explore or hint at a new policy of AIT, or average inflation targeting.
"This means that central bank policymakers would be prepared to tolerate prices rising above 2% for periods of time to compensate for other periods of time when inflation is running below target.
"He is also likely to ram home the message from his previous press conference that the recovery still largely depends on the virus, and the Fed remains ready to do whatever is necessary to support the economy.
"At the risk of coming across as rather glib, I’m not altogether sure how this is any different to what central banks have been doing for the past twelve years, and appears to come across as rather desperate."
In corporate news, WPP plunged to a £2.6bn first-half loss as revenue fell and the advertising company wrote down £2.7bn for the reduce value of its assets during the Covid-19 crisis.
The company swung to a pre-tax loss of £2.58bn in the six months to the end of June from a £409m profit a year earlier as revenue dropped 12.3% to £5.58bn. WPP reinstated its dividend, which was 56% lower than a year earlier at 10p a share.
Aircraft engine maker Rolls-Royce reported a large interim loss and scrapped its dividend as the coronavirus pandemic grounded airline fleets around the world.
The company said revenue fell 26% to £5.8bn as it posted a £1.7bn underlying operating loss, including £1.2bn in one-off charges in civil aerospace, largely related to COVID-19.
Flutter Entertainment posted a 22% jump in pro-forma first-half revenues to £2.39bn for a 35% surge in earnings before interest, taxes, depreciation and amortisation to £684m.
Profits before tax however crashed by 70% to £24m on a reported basis and earnings per share were down 81% to 18.1p. On an adjusted basis, EPS did rise by 29% to 187.5p.
The sports betting outfit reported "strong" growth outside the US. On the flip side, aligning the business with regulatory changes was expected to cost £65m over the year.
Management was "encouraged" with trading for the second half to date but said that the outlook remained "highly uncertain" due to Covid-19 and possible regulatory changes.