London pre-open: Footsie to start lower, tracking losses on Wall Street
Senior
162.00p
17:05 18/04/24
London's top flight index is seen starting the session moderately lower, tracking losses on Wall Street last Friday.
Aerospace and Defence
10,434.76
17:14 18/04/24
Banks
3,882.59
17:14 18/04/24
Entain
824.20p
16:35 18/04/24
FTSE 100
7,877.05
17:14 18/04/24
FTSE 250
19,450.67
17:14 18/04/24
FTSE 350
4,334.00
17:14 18/04/24
FTSE All-Share
4,290.02
16:54 18/04/24
Indivior
1,524.00p
16:35 18/04/24
Pharmaceuticals & Biotechnology
21,132.77
17:14 18/04/24
Travel & Leisure
7,512.73
17:14 18/04/24
Virgin Money UK
1,704.30p
16:30 18/04/24
Front and centre on traders' minds, rate-setters at the Bank of Japan, US Federal Reserve and at the Bank of England are all set to meet over the coming week, starting with the former on Tuesday, to decide on monetary policy.
The all-important monthly US jobs report is also set for release, on Friday.
Ahead of those risk events, which come as 10-year US Treasury note yields are trading back near the psychological 3.0% mark, the Footsie is being called to start the session down by 38 points to 7,663.
As far as the BoE is concerned, the economist consensus is expecting a 25 basis point hike in Bank Rate on Thursday, to 0.75%.
However, by and large markets appear to be quite sceptical that another rate hike will follow before the end of 2019, with the uncertainty around Brexit a key factor.
According to analysts at ING, "after August, markets are barely pricing in another rate hike before the end of 2019. We suspect policymakers would prefer investors to expect an earlier move, however realistically we think the Bank will struggle to hike rates again for quite some time.
"As long as Brexit talks remain in deadlock (specifically over the Irish backstop), talk of ‘no deal’ will only increase. If this starts to hit sentiment, it would complicate efforts to tighten policy further."
On that note, in an interview with Bloomberg, Governor Mark Carney said contingency planning for Brexit now takes up nearly half his time.
Analysts at Jefferies were in a similar frame of mind, saying: "It remains an open question when the UK will see a 1.5% Bank Rate again. But, there are parallels with the ECB, where going forwards there will be more focus on 2020, after both Mark Carney & Mario Draghi have moved on."
In the headlines as well, at the weekend, Italian far-right deputy prime minister, Matteo Salvini, told The Sunday Times that his government would back the UK in its trade talks, urging Westminster to take a tougher stance in its negotiations with Brussels.
The UK aso received a dose of support from China, with newly-minted foreign minister, Jeremy Hunt, saying that Beijing had offered to start discussions on a free trade deal with Britain.
Consumer credit and mortgage lending figures for June are set for release at 0930 GMT.
Senior pleases, bumps up pay-out
Aerospace and automobile engineering group Senior bumped up its interim dividend payout by 6.8% to 2.19p, telling shareholders that trading was ahead of expectations over the six months ending on 30 June, with higher margins seen in both of its main divisions. Profits before tax meanwhile were 20% higher at £39.0m (Numis: £37.0m). Free cash flow also improved, the company said, rising 9% to £32.2m, even as the firm cut net debt by £33.0m to £148.8m.
Ladbrokes owner GVC Holdings has set up a 50-50 joint venture with Las Vegas casino giant MGM Resorts International to capitalise on the new sports betting laws in the US. The pair will invest $100m apiece into the new JV and said its formation would significantly increase the speed to market for both parties, lower execution risk and create "meaningful early mover advantages", getting up and running before the start of the upcoming NFL season.
CYBG confirmed that trading in the three months to 30 June was in line with its expectations on Monday, with year-to-date mortgage growth of 3.8% on an annualised basis after its third quarter to £24.2bn. The FTSE 250 firm said that as previously guided, it saw reduced mortgage drawdowns in the third quarter due to lower applications in the second quarter, with full-year mortgage growth expected to be at the lower end of its guidance range, as previously indicated. It said the all-share offer for Virgin Money was continuing to progress as planned.
Indivior's lawyers will be able to begin arguing the drug developer's case against Dr Reddy Laboratories in October, after the US appeals court agreed to speed up the process. Dr Reddy's is appealing after it was prevented from selling its generic version of Indivior's Suboxone Film, a treatment for opioid addiction.