11th Aug 2025 06:49
(Alliance News) - Stocks in London are set to open slightly higher on Monday, in what is expected to be a quiet start to the week, before US inflation data and readings of the UK economy and labour market move into focus.
US consumer price index data is released Tuesday afternoon, after a UK unemployment reading in the morning. Thursday has a UK gross domestic product reading.
IG says futures indicate the FTSE 100 to open 5.0 points higher, 0.1%, at 9,100.73 on Monday. The index of London large-caps closed down 5.04 points, 0.1% at 9,095.73 on Friday.
Sterling rose to USD1.3468 on Monday, from USD1.3450 at the time of the London equities close on Friday. The euro perked up to USD1.1672 from USD1.1666, while against the yen, the buck faded to JPY147.48 from JPY147.73.
The yield on the US 10-year Treasury faded to 4.28% on Monday, from 4.29% at the time of the London equities close on Friday. The yield on the 30-year eased to 4.85% from 4.86%.
A recent US employment report confirmed "signs of fragility" in the labour market, a senior central bank official said Saturday, backing three interest rate cuts this year to guard against further weakening.
In prepared remarks to a summit in Colorado, Federal Reserve Vice Chair for Supervision Michelle Bowman called for a "proactive approach" in lowering the benchmark lending rate.
Doing so "would help avoid a further unnecessary erosion in labour market conditions" and reduce the chance that the Fed's rate-setting committee will need to make a larger cut if the jobs market worsened further, she said.
Bowman also made the case that price increases from President Donald Trump's sweeping tariffs this year will likely represent "a one-time effect."
She expects inflation will return to the Fed's 2% target after the tariff effects dissipate.
In New York on Friday, the Dow Jones Industrial Average rose 0.5%, the S&P 500 added 0.8% and the Nasdaq Composite shot up 1.0%.
In Tokyo on Monday, financial markets were closed for Mountain Day. In China, the Shanghai Composite was up 0.4% in afternoon trade, while the Hang Seng Index in Hong Kong was up 0.1%. Sydney's S&P/ASX 200 traded up 0.3%.
"This, again, feels like a market that you just can't keep down for long, especially with participants banking on another extension of the US-China trade truce, ahead of its scheduled 12th August expiry." Pepperstone analyst Michael Brown commented.
"There are a few bits and bobs of interest on the docket this week, though that can't be said about today, where there are no scheduled releases of any note whatsoever."
Consumer prices in China were flat year-on-year in July, official data showed Saturday, providing a respite for the world's second-largest economy, which is facing strong deflationary pressure and fragile domestic demand.
The consumer price index – a key measure of inflation – was unchanged year-on-year in July, according to data released by China's National Bureau of Statistics. The reading was better than the 0.1% fall forecast in a survey of economists by Bloomberg. In June, prices rose 0.1% on-year.
Prices nevertheless fell year-on-year in rural areas (down 0.3%) and for consumer goods (down 0.4%).
A barrel of Brent eased to USD66.18 early Monday, from USD66.63 late Friday afternoon. Gold declined to USD3,379.81 an ounce from USD3,393.20.
The US ambassador to Nato said on Sunday that Ukrainian President Volodymyr Zelensky could attend this week's US-Russia summit in Alaska, as European leaders push for Kyiv to be part of the negotiations.
Ambassador Matthew Whitaker was asked on CNN whether Zelensky might join US President Donald Trump and his Russian counterpart Vladimir Putin on Friday.
"Yes, I certainly think it's possible," he said. "Certainly, there can't be a deal that everybody that's involved in it doesn't agree to. And, I mean, obviously, it's a high priority to get this war to end."
The planned summit without Zelensky has raised concerns that a deal would require Kyiv to cede swaths of territory, which the EU has rejected.
Monday's local corporate calendar sees half year results from building materials company, Marshalls. Later in the week, results are due from housebuilder Persimmon, insurer Aviva and betting firm Entain.
By Eric Cunha, Alliance News news editor
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