12th Jun 2025 06:54
(Alliance News) - London's FTSE 100 is called to open lower on Thursday, as optimism following a cooler-than-expected US inflation reading wanes.
Weighing on sentiment on Thursday are Middle East tensions, and tariff threat from the US president. Stocks in New York surrendered earlier gains to close lower on Wednesday, while Asian equities were weaker on Thursday.
IG says futures indicate the FTSE 100 to open 39.5 points lower, 0.5%, at 8,824.85 on Thursday. The index of London large-caps closed up 11.27 points, 0.1%, at 8,864.35 on Wednesday.
In Tokyo on Thursday, the Nikkei 225 was 0.6% lower in afternoon trade. In China, the Shanghai Composite was slightly lower, while the Hang Seng Index in Hong Kong shed 0.9%. Over in Sydney, the S&P/ASX 200 was 0.1% lower.
The weak trade in the Asia Pacific region followed a lower close in New York. Stocks in New York fell despite the start of the trading day stateside offering some promise amid a trade "framework" between the world's two largest economies, as well as a softer than expected US inflation reading.
The Dow Jones Industrial Average ended slightly lower, the S&P 500 lost 0.3% and the Nasdaq Composite shed 0.5%.
"What began as a feel-good session fuelled by soft US CPI and news of a US–China trade 'framework' ended with risk appetite being dragged into the war bunker. The so-called trade breakthrough was enough to keep bulls nibbling in early trade, but geopolitical noise out of the Middle East turned that sugar high into heartburn by the close," SPI Asset Management analyst Stephen Innes commented.
President Donald Trump said US personnel were being moved from the potentially "dangerous" Middle East on Wednesday as nuclear talks with Iran faltered and fears grew of a regional conflict.
Trump also reiterated that he would not allow Iran to have a nuclear weapon, amid mounting speculation that Israel could strike Tehran's facilities.
Against the dollar, sterling rose to USD1.3586 on Thursday morning, from USD1.3545 at the time of the London equities close on Wednesday.
UK gross domestic product data on Thursday is expected to show the UK economy declined 0.1% on-month in April. It had expanded 0.2% in March from February.
The yield on the 10-year US Treasury narrowed to 4.41% early Thursday, from 4.44% at the time of the closing bell on the London Stock Exchange on Wednesday. The 30-year yield slimmed to 4.91% from 4.93%.
The euro climbed to USD1.1524 on Thursday morning from USD1.1486 at the time of the European equities close on Wednesday. Against the yen, the dollar fell to JPY143.83 from JPY144.63.
The dollar struggled after US President Donald Trump's latest tariff threat, Swissquote analyst Ipek Ozkardeskaya commented.
"Trump has threatened other Asian nations with fresh tariffs—saying his administration will send letters within two weeks to inform them of unilateral tariffs as a pressure tactic. US Treasury Secretary Bessent, on the other hand, suggested that they could extend the deadline by 90 more days if they believe 'good faith' efforts are being made," the analyst explained.
A barrel of Brent rose to USD69.29 early Thursday, from USD68.23 at the time of the London equities close on Wednesday. Gold rose to USD3,374.21 an ounce from USD3,338.63.
Thursday's economic events calendar has the UK GDP reading at 0700 BST, before US producer price inflation data and initial jobless claims at 1330.
On Thursday's UK corporate calendar, Crest Nicholson publishes half-year results and Halma, PayPoint and others release full-year results.
By Eric Cunha, Alliance News news editor
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