20th Jul 2015 06:00
LONDON (Alliance News) - London-listed stocks are called to open flat Monday, while the prospects of a US Federal Reserve interest rate hike later in the year has sent gold prices down to a fresh five-year low.
IG says futures indicate the FTSE 100 to open flat at 6,776.7 points. The index closed down 0.3% at 6,775.08 on Friday on expectations of rate hikes by the Fed and the Bank of England later this year following comments from the Fed Chair Janet Yellen and Bank of England Governor Mark Carney.
Rhys Herbert, senior economist at Lloyds Bank says that with little significant economic data this week, focus is likely to remain on the prospects of a Fed rate hike.
"Given the lack of data it is likely, in the absence of further developments in the Greek crisis or major fluctuations in the Chinese stock market, that markets will fall back on speculation about the next moves in monetary policy," Herbert says. "Of most interest to markets of course, is when the Fed is likely to make its first move to tighten monetary policy."
Gold has been sold off as speculation of a September US rate hike grows. The metal fell to its lowest price since February 2010 overnight to USD1,073.40 an ounce.
Wall Street closed mixed Friday, with the DJIA closing down 0.2%, the S&P 500 ending up 0.1%, and the Nasdaq Composite closing at a new record high, up 0.9%.
In Asia Monday, the Tokyo market is closed to celebrate Marine Day. The Hang Seng trades down 0.1% in Hong Kong, and the Shanghai Composite is up 0.5%.
In the UK corporate calendar, there is a first-quarter interim management statement from property developer British Land Co and a second-quarter statement from gold producer Polyus Gold International. Schroder Real Estate Investment Trust reports full-year results while Michelmersh Brick Holdings provides half-year results.
In a quiet economic calendar, there are the German producer price index at 0700 BST, eurozone current account at 0900 BST and UK public sector net borrowing at 0930 BST. At 1100 BST, the German Bundesbank releases its monthly report.
By Neil Thakrar; [email protected]; @NeilThakrar1
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