London pre-open: Stocks seen up on positive Asian cues
London stocks were set for a firmer open on Monday, taking their cue from a positive session in Asia as investors eyed a slew of UK data releases.
The FTSE 100 was called to open 23 points higher at 7,305.
Ipek Ozkardeskaya, senior market analyst at London Capital Group, said: "Asian equities kicked off the week on a positive note as lower-than-expected jobs report in the US consolidated the dovish Federal Reserve expectations and the People’s Bank of China (PBoC) announced more monetary stimulus amid country’s exports fell 1% in USD terms in August as a result of the escalating trade war with the US.
"Chinese exports toward the US tanked 16%. Chinese officials took additional stimulus measures as data started looking uglier. In addition to 50-basis-point nationwide RRR cut revealed earlier, the PBoC delivered 100-basis-point targeted cut for regional banks. The PBoC’s determination to fight the economic slowdown encouraged investors to buy stocks on Monday open, but gains remained timid."
On the UK data front, manufacturing and industrial production figures are due at 0930 BST, along with the trade balance.
In corporate news, Lloyds Bank said it was suspending the rest of its 2019 share buyback after a higher-than-expected spike in payment protection claims ahead of the August deadline led to an increased provision for potential payouts.
The company said it would now make provisions in the range of £1.2bn - £1.8bn in the third quarter in addition to the £650m made at the half year.
“The group now expects capital build in 2019 to be below our ongoing 170 to 200 basis points per annum guidance and for the statutory return on tangible equity to be lower than our 2019 guidance of around 12 per cent, with the final outcome dependent on the actual charge taken,” Lloyds said in a statement.
“In line with its prudent approach, and the uncertainty around the final outcome for PPI, the board has decided to suspend the remainder of the 2019 buyback programme, with £600m of the up to £1.75bn programme expected to be unused at mid-September.”
Essentra said it had bought Nekicesa Packaging from GED Iberian and EBN Vaccaria for an undisclosed sum.
Nekicesa is a converter of folding cartons supplying the Spanish pharmaceutical end-market. Essentra on Monday said the company had been acquired on a cash-free, debt-free basis, funded from existing facilities with the transaction immediately earnings enhancing.
AB Foods left its outlook unchanged as it reported that adjusted earnings will be in line with the previous year after a weaker period for its sugar division offsets strong profit performances from Primark and its grocery division.
Lower EU sugar prices have impacted the UK and Spanish sugar businesses, while a poor crop dealt a blow to Chinese sales volumes.