19th Mar 2025 07:00
(Alliance News) - Stocks in London are set to open higher on Wednesday despite a decline in New York shares, as investors digest a Bank of Japan interest rate decision and look ahead to the Federal Reserve later.
Eyes were also on commodity prices in the early morning, as gold reached another record high.
IG says futures indicate the FTSE 100 to open 6.3 points higher, 0.1%, at 8,711.53 on Wednesday. The index of London large-caps closed up 24.94 points, 0.3%, at 8,705.23 on Tuesday.
Sterling was quoted at USD1.2983 early Wednesday, lower than USD1.2991 at the London equities close on Tuesday.
The euro traded at USD1.0927 early Wednesday, lower than USD1.0931 late Tuesday. Against the yen, the dollar was quoted at JPY149.74, up from JPY149.55.
In Asia on Wednesday, the Nikkei 225 index in Tokyo was down marginally. In China, the Shanghai Composite was down 0.2%, while the Hang Seng index in Hong Kong was 0.1% higher. The S&P/ASX 200 in Sydney closed 0.4% lower.
On Wednesday, the Bank of Japan kept its interest rates unchanged.
The BoJ left its short-term policy rate unchanged at around 0.5% following its latest monetary policy meeting on Wednesday.
The decision by the Policy Board was passed by a unanimous vote.
Japan's central bank last revised its key interest rate in January with a 25 basis point hike, the highest level in 17 years.
In a statement, the BoJ said: "Japan's economy has recovered moderately, although some weakness has been seen in part. Overseas economies have grown moderately on the whole. Exports and industrial production have been more or less flat. With an improving trend in corporate profits, business fixed investment has been on a moderate increasing trend. The employment and income situation has improved moderately. Private consumption has been on a moderate increasing trend despite the impact of price rises and other factors. Housing investment has been relatively weak. Public investment has been more or less flat. Financial conditions have been accommodative."
At 1800 GMT, the Fed announces its latest decision. The US central bank is also expected to leave rates unmoved.
US President Donald Trump and Russian President Vladimir Putin agreed during a call on Tuesday to seek a limited ceasefire against energy and infrastructure targets in the Russia-Ukraine war, according to the White House.
Wall Street ended lower in the US on Tuesday, with the Dow Jones Industrial Average down 0.6%, the S&P 500 down 1.1% and the Nasdaq Composite down 1.7%
"Recent economic data continues to indicate weakness in the US economy. February retail sales rose only 0.2% from the previous month, falling well short of the 0.6% forecast, signalling a decline in domestic consumption. The Empire Manufacturing Index also dropped to its lowest level in over a year, highlighting a slowdown in the manufacturing sector," said XS.com analyst Linh Tran.
"These figures have raised concerns that the US economy is under significant pressure from the Trump administration's tariff policies, reducing expectations for growth in the next quarter and exerting downward pressure on both the stock market and the S&P 500."
Germany's Bundestag approved a historic easing of the country's debt limit on Tuesday, to boost defence spending and earmark EUR500 billion for infrastructure and climate protection measures.
Chancellor Friedrich Merz justified the planned billions in debt saying it is needed for the security of Germany, Europe and Nato.
"It is a war against our country, too, which is taking place every day," he said referring to Russia's more than three-year war against Ukraine.
Gold was quoted at USD3,037.20 an ounce early Wednesday, up from USD3,035.29 on Tuesday. The yellow metal hit a record high of more than USD3,045 an ounce earlier on Wednesday morning.
Brent oil was trading at USD70.08 a barrel, lower than USD70.76 late Tuesday.
In Wednesday's corporate calendar insurer Prudential releases full-year results.
The economic calendar for Wednesday has the eurozone CPI figures at 1000 GMT.
By Emily Parsons, Alliance News reporter
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