5th Oct 2018 06:55
LONDON (Alliance News) - Stock prices in London are seen opening higher on Friday despite rising US treasury yields hindering markets in both the US and Asia overnight.
IG futures indicate the FTSE 100 index is to open 16.5 points higher at 7,430.2. The blue chip index closed down 1.2% at 7,418.34 on Thursday.
A very quiet UK corporate calendar on Friday has just a trading statement from car dealership Motorpoint.
"Wall Street fell sharply lower on Thursday, as treasury yields hit the highest level since 2011," said London Capital Group's Jasper Lawler.
"Rapidly rising treasury yields are dampening appetite for stocks, stoking fears higher rates will hold back growth. Another round of impressive data from the US fanned concerns over inflation and the potential for a steeper path of tightening from the Fed."
"The US economy is on fire right now and the bond market has been underestimating just how hot the economy is. What we are seeing here is that complacency start to fade," he continued.
"Asian markets traded lower taking the lead from the US, however Europe looks to be bucking the trend with a positive start on the cards. The only data release for the UK will be Halifax housing prices are expected to show a decline over the three months to September but a tick higher on a monthly basis."
The Japanese Nikkei 225 index is down 0.5% while the Hang Seng index in Hong Kong is down 0.4%. Financial markets in China remain closed for a week long holiday.
On Wall Street, stocks closed lower on Thursday. The Dow Jones Industrial Average closed 0.8% lower, the S&P 500 also 0.8% lower, and the Nasdaq Composite down 1.8%.
An FBI investigation into allegations of sexual assault against US Supreme Court nominee Brett Kavanaugh is "incomplete" and "too limited" in scope, Senate minority leaders Dianne Feinstein and Chuck Schumer said on Thursday.
Feinstein said the report made available to senators was "the product of an incomplete investigation," while Schumer said the probe had been "too limited" considering the fact that neither Kavanaugh nor his accuser, Christine Blasey Ford, were interviewed.
Meanwhile, Mitch McConnell, the Republican leader in the Senate, said the report submitted by the FBI had "not corroborated" the accusations and that senators should avoid the "fundamentally un-American precedent" of finding someone guilty without evidence.
In UK data, the Halifax house price index is out at 0830 BST. Later in the day comes US unemployment and non-farm payrolls at 1330 BST.
In Europe on Friday, there is German PPI, manufacturing orders, and manufacturing turnover at 0700 BST.
In early UK company news, Rio Tinto said it has opened a new mine at Hope Downs in Western Australia's Pilbara region, in its joint venture with Hancock Prospecting.
The partners have also approved investment into greater automation, driving productivity, and safety.
Rio Tinto's iron ore Chief Executive Chris Salisbury said: "This investment will ensure sustainable production levels at the Hope Downs 1 operation and is a clear demonstration of our continuing commitment to the people of Western Australia and the joint venture partnership."
"As we introduce autonomous technology across the business we continue to work closely with our employees to develop their career pathways. To date, we have successfully redeployed or up-skilled employees impacted by automation and we would expect this trend to continue with the extension of this technology at Hope Downs."
Theresa May is facing renewed calls to abandon her Chequers blueprint for Brexit after European Council president Donald Tusk said the offer of a simple, Canada-style free trade deal remained open.
Following talks in Brussels with Irish premier Leo Varadkar, Tusk said the EU remained committed to securing a deal with the UK which maintained a relationship that was "as close and as special as possible".
He said the EU's proposal for an enhanced version of the free trade deal it negotiated with Canada – sometimes referred to as "Canada+++" – was still on the table.
His intervention comes after May told the Conservative Party Conference in Birmingham that her Chequers plan was the only proposal which would avoid the imposition of a hard border between Northern Ireland and the Republic.
The pound was quoted at USD1.3007 early Friday, compared to USD1.3024 at the close on Thursday.
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