London pre-open: Stocks to edge up as investors eye Brexit, trade developments
London stocks were set to open a little firmer on Wednesday following losses in the previous session, as investors continued to eye Brexit developments and this week’s Sino-US trade talks.
The FTSE 100 was called to open 12 points higher at 7,155.
Ipek Ozkardeskaya, senior market analyst at London Capital Group, said: “It looks like this week’s negotiations will be held in quite a tense atmosphere. The trade war between the US and China is taking a perilous political turn. If it comes down to an ideology clash, then the world should prepare for further disruptions in global trade.
“According to South China Morning Post, a news provider banned in China, Chinese officials could even cut their visit in Washington short by a day if they see no light at the end of the tunnel. The direct consequence of this would be higher tariffs on additional Chinese imports by next week, a further deterioration in the US-China trade war and a decent reaction sell-off in global stocks.”
On the Brexit front, meanwhile, things weren’t looking good either after German Chancellor Angela Merkel told British Prime Minister on Tuesday that a deal was “overwhelmingly unlikely” unless Northern Ireland stays in the customs union.
“Not that investors have ever bet on a Brexit deal before the October 31st deadline, but the likelihood of a consensual divorce within the next two weeks is now down to nil, unless a miracle happens by then,” said Ozkardeskaya.
In UK corporate news, gambling firm GVC Holdings upgraded full year profit forecasts after a strong third quarter driven by online revenues.
The company said it now expected earnings before interest, tax depreciation and amortisation to be in the range of £670m - £680m, up from £650m - £670m).
GVC added that like-for-like net gaming revenue in the UK fell 18% after the government cut the maximum stake on fixed odds betting terminals to £2 from £100.
Home improvement retailer Kingfisher announced the appointment of Bernard Bot as its new chief financial officer with effect from 21 October.
The company said Bot would also become a member of the group executive team. It also announced that John Wartig, who joined Kingfisher as interim CFO on 8 April, had been appointed to the newly-created role of chief transformation and development officer. It said he would remain on the executive team, with direct responsibility for transformation, IT, business development and property, and would report to chief executive Thierry Garnier.
Unite Group has signed a nominations agreement with the University of Leeds that covers 559 of the 976 beds in its new White Rose View student accommodation, which will open in time for the 2020/21 academic year.
The private student halls provider, which targets one or two new university partnership deals per year, said the deal underpinned a development yield in line with its targets.