London pre-open: FTSE to open lower ahead of Draghi speech

The UK's blue chips are set for a negative start on Monday morning, following a weaker finish in the US on Friday.

City sources predict the FTSE 100 will open around 32 points lower than Friday's close of 6,837.92.

"Global indices are looking to start the week on a somewhat softer tone, with the Asian markets leading the way lower overnight," said Alpari market analyst Joshua Mahony.

"Following the excitement of Friday’s Scottish referendum and Alibaba initial public offering, things have come down with a bump, especially in China and Japan where a fall in commodity prices hit valuations."

The weekend also saw both Europe and Japan highlighted as regions that, according to US Treasury Secretary Jack Lew, are holding the global economy back. He called on both to do more to help boost the recovery and improve growth.

Mahony said the comments "highlight the importance of success for Mario Draghi and increasingly there appears to be less and less options but to implement a fully blown quantitative easing programme in the near future."

Draghi is due to speak on Monday afternoon, when he will address the European Parliament’s Economic and Monetary Committee, with the focus expected to be very much on monetary policy.

In UK company news, Tesco has revised its profit forecast for the six months ended 23 August, saying it had previously overestimated it by £250m. The retailer giant cited “accelerated recognition of commercial income” and “delayed accrual of costs” as the main factors behind the overstatement and announced it was working to establish what impact it will have on the full year.

Communications group WPP has announced plans to invest $25m in the AppNexus to enhance its position as the world's largest independent ad technology provider. The group said that by taking a greater stake in AppNexus, it "further cements its leadership position in ad tech and programmatic targeting".

Dairy Crest sees first half group profits broadly in line with last year, with sales from its four key brands having grown at a similar pace, of 4%, as in the first quarter, the company said in a pre-close trading update. Property profits from the sale of surplus depots will make up a greater proportion of its profits than in the same period last year.