16th Sep 2024 06:34
(Alliance News) - Equities in London are called to open a touch higher on Monday, though markets in Asia started the week slowly after disappointing China data.
IG says futures indicate the FTSE 100 to open 5.2 points higher, 0.1%, at 8,278.29 on Monday. The index of London large-caps rose 32.12 points, or 0.4%, at 8,273.09 on Friday.
Focus this week will be on a trio of central bank decisions, starting with the US Federal Reserve on Wednesday.
SPI Asset Management analyst Stephen Innes commented: "This week's Federal Reserve decision will be the main event, with all eyes glued to the dot plot and Powell's every word. Will the Fed kick off the rate-cutting cycle with a big swing or play it safe with a smaller move? Either way, the real drama lies in what happens after the Fed hits go.
"Here's the rub: Investors are trying to decipher whether the recent economic data suggests the economy is cooling down to a manageable pace or whether it's the first signs of a deeper, darker slowdown. Stock traders are betting on a soft landing, while bond traders—eyeing 250 basis points of cuts—are bracing for a full-blown recession. Everyone's looking to the Fed's dot plot for clues, and the stakes couldn't be higher. The market's next moves could be a wild whipsaw between the two camps as they grapple for the upper hand."
The Bank of England follows on Thursday, before the Bank of Japan on Friday.
Sterling was quoted at USD1.3153 early Monday, up from USD1.3137 at the London equities close on Friday. The euro rose to USD1.1096 from USD1.1084. Against the yen, the dollar faded to JPY140.23 from JPY140.53, briefly falling below the JPY140 mark.
Financial markets in Tokyo are closed on Monday. In China, the Shanghai Composite was down 0.5%. The Hang Seng in Hong Kong was marginally lower. The S&P/ASX 200 in Sydney was 0.3% higher.
Chinese retail sales and industrial production growth slowed in August, official data showed Saturday, as leaders in Beijing seek paths to achieve growth targets despite consumers' reluctance to spend.
More than a year and a half since abolishing strict Covid-19 measures that had dampened activity, the world's second-largest economy has yet to achieve a highly anticipated post-pandemic recovery.
A prolonged debt crisis in China's vast property sector, continued deflationary pressure and high unemployment are among the factors now weighing on investor confidence.
In August, retail sales increased 2.1% year-on-year, slowing from 2.7% in July, according to data released by the National Bureau of Statistics.
The figure also came up short of the 2.5% growth forecast by a Bloomberg survey of analysts.
Year-on-year industrial production also slowed, NBS data showed, dropping from 5.1% growth in July to 4.5% in August.
The Bloomberg forecast had anticipated industrial production to grow 4.7% last month.
Gold was quoted at USD2,586.21 an ounce early Monday in London, rising from USD2,578.76 at the time of the European equities close on Friday. Brent oil traded at USD71.53 a barrel, easing from USD72.58.
Monday's UK corporate calendar has half-year results from Keywords Studios, a services provider to the video game industry.
The economic events calendar has a eurozone trade balance reading at 1000 BST.
By Eric Cunha, Alliance News news editor
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