17th Oct 2024 07:00
(Alliance News) - Stocks in London are set to open higher on Thursday, ahead of an interest rate decision from the European Central Bank, and a slew of data from the US.
IG says futures indicate the FTSE 100 to open up 23.5 points, or 0.3%, at 8,354.30 on Thursday. The index of London large-caps closed up 79.79 points, or 1.0%, at 8,329.07 on Wednesday.
Sterling was quoted at USD1.2984 early Thursday, lower than USD1.3006 at the London equities close on Wednesday.
The euro traded at USD1.0855 early Thursday, lower than USD1.0874 late Wednesday. Against the yen, the dollar was quoted at JPY149.42 versus JPY149.65.
European Central Bank policymakers meet on Thursday with fading price pressures and weaker economic activity in the eurozone nudging them towards making another cut to interest rates.
Recent data show that inflation in the eurozone has slowed considerably. For the whole of the eurozone, the annual rate of consumer price rises was 1.8% – the first time it has been below the ECB's 2% target in three years.
After cutting rates twice already this year, including at their last meeting in September, policymakers initially signalled a preference to wait until December to cut again.
But September's below-expectations reading has added to the sense that consumer prices are back under control after they soared in the wake of the coronavirus pandemic and the Russian invasion of Ukraine.
"Victory against inflation is in sight," French central bank governor and ECB rate-setter Francois Villeroy de Galhau said last week.
"A cut is very likely," he said of Thursday's meeting, adding that "it will not be the last". From its peak of 4%, the ECB has cut its key deposit rate in two increments of 25 basis points, once in June and another time in September.
In the US on Wednesday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.8%, the S&P 500 up 0.5% and the Nasdaq Composite up 0.3%.
In Asia on Thursday, the Nikkei 225 index in Tokyo was down 0.6%. In China, the Shanghai Composite was down 0.1%, while the Hang Seng index in Hong Kong was up 0.3%. The S&P/ASX 200 in Sydney closed up 0.9%.
Japanese exports unexpectedly declined on-year for the first time in 10 months as weaker global demand and a stronger yen hit the country's manufacturers in September.
Japan's exports rose 7.2% to JPY9.038 trillion in September from JPY8.433 trillion in August, but were 1.7% lower than JPY9.199 trillion in September 2023.
Japan's imports climbed 2.1% to JPY9.332 trillion in September from JPY9.137 trillion in August, and were 2.1% higher than JPY9.138 trillion in September 2023.
The country's trade surplus fell to JPY294.34 billion, about USD1.97 billion, in September from JPY703.20 billion in August, but was up from JPY60.56 billion in September 2023.
In September the yen traded at its strongest levels against the dollar for the year to date, briefly hitting JPY140.8. It has weakened in October after new Prime Minister Shigeru Ishiba questioned the need for further interest rate increases by the Bank of Japan.
Gold was quoted at USD2,677.91 an ounce early Thursday, higher than USD2,673.31 on Wednesday.
Brent oil was trading at USD74.35 a barrel early Thursday, higher than USD73.83 late Wednesday.
In Thursday's corporate calendar, there are trading statements from AJ Bell, Entain, Mondi, Rathbones, Rentokil, Sabre Insurance, and St James's Place. There are third quarter results from Centamin, Ibstock, Schroders, and Travis Perkins.
In the economic calendar on Thursday, there is trade balance, CPI data, and an interest rate decision from the eurozone. Later in the day, there is initial jobless claims, industrial production, and retail sales, among other prints, from the US.
By Holly Beveridge, Alliance News senior reporter
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