4th Jun 2015 06:31
LONDON (Alliance News) - London share prices are set to open lower Thursday, as a lack of significant economic data to be released puts market attention on the Bank of England interest rate decision due at 1200 BST and the continuing Greek debt drama.
IG says futures indicate the FTSE 100 to open 28 points lower at 6,922.6. The index closed up 0.3% at 6,950.46 on Wednesday, after European Central Bank President Mario Draghi called for a strong agreement with Athens and its creditors to ensure Greece remains in the eurozone.
Greek Prime Minister Alexis Tsipras met European Commission President Jean-Claude Juncker in Brussels on Wednesday, while the head of the Eurogroup of finance ministers, Jeroen Dijsselbloem, also later joined later the meeting, whose aim was to hammer out a deal that would pave the way for unlocking aid to the Mediterranean country.
"The discussions are going to continue in the coming days," Tsipras said after the meeting. "The more we talk sincerely, the closer we will get to a mutually acceptable solution."
Meanwhile, Dijsselbloem said the talks were "very good," a sentiment echoed by the European Commission, which described it as a "good, constructive" meeting.
Michael Hewson, chief markets analyst at CMC Markets UK, says the hope is seeing Greece make its Friday's EUR300 million payment to the International Monetary Fund either on time, or at least deferred without too much fuss and rolled up into the remaining repayments later this month.
Oanda analyst Craig Erlam believes that, while both sides remain in disagreement over some key issues, progress seems to be being made.
"A smaller fiscal surplus target looks close to being agreed, which shows that Greece's creditors are slowly but surely making concessions themselves," Erlam writes. "Debt forgiveness looks off the table for now, the key point going forward is how both sides will negotiate on pension and labour market reforms."
Outside Greece, Erlam believes Thursday's Bank of England meeting is unlikely to surprise the market as Governor Mark Carney made it clear recently that the BoE is unlikely to raise interest rates until the middle of next year.
Wall Street ended higher Wednesday. The DJIA closed up 0.4%, the S&P 500 ended up 0.2% and the Nasdaq Composite finished up 0.5%.
In Asia on Thursday, the Japanese Nikkei 225 is trading down 0.2% while the Hang Seng trades down 1.0%. The Shanghai Composite is trading down 3.0%.
In the corporate front, Johnson Matthey Thursday reported a large rise in pretax profit and its dividend that both comfortably beat market expectations.
The FTSE 100-listed speciality chemicals and metals company reported a pretax profit of GBP495.8 million in the year ended March 31, rising from a GBP406.6 million profit a year earlier. That easily beat analysts' forecasts of GBP437.3 million. Revenue for the year fell to GBP10.05 billion from GBP11.15 billion, but Johnson Matthey's margin improved as it produced a higher gross profit of GBP817.7 million from GBP799.1 million.
Sports Direct International said it has made Group Financial Controller Matt Pearson its acting chief financial officer and he will take his place on the board with immediate effect. Pearson joined the sports goods retailer as group financial accountant from EY in June 2007, and subsequently became financial controller.
Petrofac said it has amended and extended its USD1.2 billion five-year revolving credit facility, which will now run until June 2020 at lower margins and commitment fees than its original facility. The facility also has two one-year extension options, subject to approval by the lenders.
Wednesday after the market close, the FTSE Committee announced its index review decision based on Tuesday's closing prices. Satellite company Inmarsat will move into the blue-chip index, replacing temporary-power provider Aggreko, which was demoted to the FTSE 250.
The change will take effect to its UK indices from the market open on Monday, June 22.
Also in the economic calendar, in the US, jobless claims data are due at 1330 BST.
By Daniel Ruiz; [email protected]
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