1st May 2025 06:54
(Alliance News) - Stocks in London are set to open higher on Thursday, following the prior day's news that the US economy contracted more than expected in the first quarter.
According to an initial estimate from the Bureau of Economic Analysis on Wednesday, gross domestic product decreased at an annual rate of 0.3% in the first quarter of 2025, slowing from an annual rate of growth of 2.4% in the fourth quarter of 2024.
"While the Q1 GDP data could've been a lot worse, one must recognise that the figures reflect just the uncertainty, and front-running of tariffs before they were imposed," Pepperstone's Michael Brown said. "Hence, things are probably likely to get considerably uglier in the second quarter, when the actual impact of tariffs takes a huge chunk out of profits, and economic activity freezes up amid the incoherent nature in which policy is being made.
"Not only that, but we also start Q2 from a much lower base in terms of growth, and much higher base in terms of inflation, than we'd been expecting. All told, pretty grim."
Stock markets in China, France, Germany and other countries are closed on Thursday for Labour Day.
IG says futures indicate the FTSE 100 to open up 62.9 points, 0.7%, on Thursday. The index of London large-caps closed 0.4% higher at 8,494.85 on Wednesday.
Sterling was quoted at USD1.3285 early Thursday, lower than USD1.3357 at the London equities close on Wednesday.
The euro traded at USD1.1296 early Thursday, lower than USD1.1365 late Wednesday. Against the yen, the dollar was quoted higher at JPY144.12 versus JPY142.66.
In the US on Wednesday, Wall Street ended mixed, with the Dow Jones Industrial Average up 0.4%, the S&P 500 up 0.2% and the Nasdaq Composite down 0.1%.
In Asia on Thursday, the Nikkei 225 index in Tokyo was up 1.3%. The S&P/ASX 200 in Sydney was up 0.3%.
Gold was quoted at USD3,235.40 an ounce early Thursday, lower than USD3,308.91 on Wednesday.
Brent oil was trading at USD61.00 a barrel early Thursday, lower than USD62.60 late Wednesday.
In Thursday's corporate calendar, Endeavour Mining and Schroders release first-quarter results.
In the economic calendar on Thursday, look out for the manufacturing PMI readings from the US and UK, plus US jobless data.
By Emma Curzon, Alliance News reporter
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