27th Apr 2015 06:35
LONDON (Alliance News) - UK stocks are set to open higher Monday, in a quiet start to a week in which investors will focus on the US Federal Reserve interest rate decision on Wednesday, and Greece's upcoming payment deadline with the International Monetary Fund.
"The continued softness of US data is likely to increase the interest in this week's [Federal Open Market Committee] meeting, with the focus likely to be on whether Fed officials believe the current soft patch is transitory, particularly if this week's Q1 GDP number comes in below 1%," says Michael Hewson, chief market analyst at CMC Markets.
"What does appear to be certain is that the prospect of a US rate rise has been put back as a result of recent US data weakness, despite some FOMC members attempts to keep the June rate meeting in play for a possible policy change," he adds.
Hewson's comments come after Friday's US core durable goods orders, which excludes orders for transportation equipment, fell by 0.2% in March compared to a 1.3% decrease in the previous month. The modest decrease came as a surprise to economists, who had expected ex-transportation orders to rise by 0.3%.
Greece's debt problems continue to worry markets as the Eurogroup meeting in Riga, Latvia on Friday delivered no progress as tensions continue between the country and its creditors. Eurogroup Chairman Jeroen Dijsselbloem said there were still wide differences to cover and to bridge with Greek authorities, and funds will not be disbursed without a comprehensive deal.
Greece is due to make a payment of around EUR200 million to the IMF on Friday.
IG says futures indicate the FTSE 100 to open 17.8 points higher at 7,088.5. The index closed up 0.2% at 7,070.70 on Friday.
On Wall Street Friday, the DJIA closed up 0.1%, the S&P 500 ended up 0.2% and the Nasdaq Composite ended up 0.7%. US earnings season continues, with Apple reporting second quarter results Monday.
In Asia on Monday, the Japanese Nikkei closed down 0.2%. The Hang Seng is up 1.6% at 28,525.99 having hit its highest level in almost seven and a half years earlier in the session. The Shanghai Composite is up 2.6% at 4,510.172, trading at its highest levels in just over seven years.
Centrica said energy consumption in the first quarter of 2015 was higher as weather was colder than expected, despite the number of residential accounts remaining broadly flat and business accounts falling, but the company reiterated its full-year guidance.
The FTSE 100 company said residential gas consumption was 10% higher in the first three months of 2015 year-on-year with electricity consumption increasing by 2%, which Centrica said was due to colder temperatures than normal during the period.
Royal Bank of Scotland Group said it will book a USD30 million loss on disposal after it sold a further portfolio of North American corporate loan commitments to Mizuho Financial Group, coming on top of the deal it did with the same bank in February.
The British bank said the latest loan portfolio it is selling in North America comprises USD5.6 billion of loan commitments, including USD0.5 billion of drawn assets as of the end of February, and generated a profit after tax in the region of USD20 million in calendar 2014.
Irish building materials company CRH said it will shortly start looking for a new finance director after it said the current holder of the role, Maeve Carton, will lead a new strategic function from the start of 2016. In a statement, CRH said Carton will become group transformation director, identifying and implementing the optimum financial and business model for the group in the years ahead.
In a quiet economic calendar, there are the Confederation of British Industry industrial trends survey results at 1100 BST, US Markit services and composite Purchasing Managers' Index readings at 1445 BST, and Dallas Fed manufacturing business index at 1530 BST.
By Neil Thakrar; [email protected]; @NeilThakrar1
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
CentricaRBS.LCRH