17th Apr 2019 06:59
LONDON (Alliance News) - Stock prices in London are called for a slightly lower open on Wednesday, despite sentiment getting a further boost from positive Chinese GDP data.
In early UK company news, mining giant BHP Group has been forced to reduce iron ore guidance for 2019 following Cyclone Veronica in Australia.
IG futures indicate the FTSE 100 index is to open 7 points lower at 7,462.92. The blue-chip index closed 0.4% higher at 7,469.92 on Tuesday.
China's economy grew 6.4% in the first quarter of 2019, holding steady from the last quarter of 2018, official data showed Wednesday.
The data beat analysts' expectations of a 6.3% growth in the first quarter.
Financial indicators in March had suggested the government's efforts to shore up the slowing economy were starting to take hold.
Exports jumped 14.2% year-on-year in March, after a serious contraction in February.
China's economy grew 6.6% last year - its slowest pace in almost three decades - due to pressure from a trade war with the US and rising government debt.
Chinese Premier Li Keqiang last month set a 6-to-6.5% economic growth target for 2019, citing "rising uncertainties" facing the world's second-largest economy.
"This is just the latest in a string of recent Chinese data that has surprised to the upside, indicating policy implemented by Beijing at the end of last year could finally be bearing fruit," said London Capital Group's Jasper Lawler.
"Concerns over the health of the Chinese economy will start to fade following the recent impressive run in data. An improvement in the Chinese economy was a necessary requirement for an improvement in the health of the global economic outlook."
The Japanese Nikkei 225 index is up 0.3%. In China, the Shanghai Composite is 0.4% higher, while the Hang Seng index in Hong Kong is marginally higher.
In the economic calendar locally on Wednesday, UK producer prices and consumer prices figures are delivered at 0930 BST.
"With wages growth at ten-year highs consumers will be hoping inflation pressures continue to remain soft, having seen headline CPI slip back over the last few months to as low as 1.8% at the beginning of the year," CMC Markets UK's Michael Hewson said.
"We have seen a modest rebound in the last couple of months, to 2%, though core prices have been more subdued, with the main price rises coming in the form of oil price rises filtering through."
In corporate news, BHP Group has reduced annual iron ore production guidance after a cyclone affected its operations, as it reported third-quarter production results.
For the nine months ended March, iron ore production remained flat at 175 million tonnes. Copper production fell 3% to 1.25 million tonnes.
In coal, metallurgical coal and energy coal production both remained unchanged at 31 million tonnes and 20 million tonnes, respectively.
BHP reduced its iron ore guidance for 2019 to between 235 million tonnes and 239 million tonnes from between 241 and 250 million tonnes previously.
This was after the firm was forced to reduce output forecast following the disruption caused by Cyclone Veronica in March. In financial 2018, iron ore production was 238.4 million tonnes.
Wednesday's UK corporate calendar has first quarter results from support services firm Bunzl, oil & gas industry services company Hunting, property group SEGRO, asset manager Quilter and cybersecurity firm Avast.
Meanwhile, trading statements are expected from estate agent Countryside Properties, private hospital firm Mediclinic International and currency manager Record.
In the US on Tuesday, Wall Street ended higher, with the Dow Jones Industrial Average closing up 0.3%, the S&P 500 0.1% higher, and the Nasdaq Composite up 0.3%.
Online-video streaming service Netflix on Tuesday reported a first-quarter profit that rose from last year, as subscriber additions surged.
Earnings for the quarter trumped Wall Street estimates, as did revenue. However, moving ahead, Netflix detailed a weak second-quarter guidance.
Netflix added 9.60 million subscribers globally in the quarter, above its forecast of 8.90 million, to end the quarter with 148.86 million subscribers. The company added 1.74 million customers in the US during the quarter, above its estimates of 1.60 million.
Netflix's first-quarter profit rose to USD344 million, or USD0.76 per share, from USD290 million, or USD0.64 per share, last year. On average, 36 analysts polled by Thomson Reuters expected earnings of USD0.57 per share for the quarter.
Netflix's revenue for the quarter rose 22% to USD4.52 billion from USD3.70 billion last year. Analysts had a consensus revenue estimate of USD4.50 billion for the quarter.
Looking forward to the second quarter, Netflix expects revenue of USD4.93 billion and earnings of USD0.55 per share. Analysts polled by Thomson Reuters currently expect earnings of USD0.99 per share and revenues of USD4.95 billion.
Elsewhere the data calendar Wednesday, eurozone current account data is released at 0900 BST with trade balance and consumer price index figures at 1000 BST.
In the US, trade balance data is printed at 1330 BST after mortgage applications figures are released at 1200 BST.
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