London pre-open: Stocks seen lower after Wall St selloff
London stocks were set for a weaker open on Wednesday following a late selloff on Wall Street as investors continued to digest new Fed chairman Jerome Powell’s first congressional testimony.
The FTSE 100 was called to open 44 points lower at 7,238.
CMC Markets analyst Michael Hewson said: "New Fed chief Jerome Powell didn’t deviate from the script when he met with US lawmakers yesterday saying that the US central bank could continue to raise interest rates gradually against a strong and improving economic outlook, and with little in the way of concern about recent market volatility.
"His comments that some of the headwinds facing the US economy were now acting as tailwinds suggests that the Fed is comfortable that inflation is likely to head back towards its 2% target, and as such the bar to further rate rises is likely to be quite high."
Investors were also mulling the latest data releases from China, as both the manufacturing and non-manufacturing PMIs for February came in lower than expected at 50.3 and 54.5, respectively.
The latest GfK survey was also in focus. It showed consumer confidence in the UK slipped in February, with the long-running index down one point to -10 from January, as expected.
Joe Staton, head of Experience Innovation UK at GfK, said: "Ongoing concerns about sluggish household income, rising prices paid by consumers in the shops, and the prospect of inflation-busting council tax and interest rate hikes has dented confidence after last month’s surprising rally. The two-year trend of negative sentiment - the overall index score has bounced between zero and -13 since February 2016 - proves consumers feel pessimistic about the state of household finances and the wider UK economy."
There are no major UK data releases due.In the US, fourth-quarter GDP and core PCE are at 1330 GMT, while the Chicago PMI is at 1445 GMT and pending home sales are at 1500 GMT.
In corporate news, business information group Informa posted its results for the 12 months ended 31 December, with revenue growing at a faster rate than the prior year - up 30.7% to £1.76bn - including Penton Information Services and YP.
The FTSE 100 company said underlying growth was 3.4%. It also saw increased adjusted operating profit growth of 31.3% to £545.5m, as well as a higher statutory operating profit of £345.3m, compared to £198.6m in 2016.
ITV profits fell last year amid a squeeze on advertising sales, but the dividend was lifted 10% as a 'strategic refresh' got underway under new chief executive Carolyn McCall.
Adjusted EBITA was down 5% to £842m even as total external revenue rose 2% to £3.13bn, of which the ITV Studios production arm saw revenue up 13% to £1.58bn.
Premier Inn and Costa owner Whitbread has announced the acquisition of a portfolio of 19 hotels in Germany from Foremost Hospitality Group for an undisclosed sum.
It said the deal will give Premier Inn substantial presence in the German hotel market, increasing the total committed network pipeline to 31 hotels with over 5,700 rooms across 15 key cities that are all expected to be open by the end of 2020.