23rd Oct 2018 07:44
LONDON (Alliance News) - The FTSE 100 index of London large-caps is called to open below the 7,000 mark on Tuesday, following risk-off trade in Asia overnight, with the focus on Brexit developments in the UK and the stand-off between Brussels and Rome over the Italian budget.In the early company news on Tuesday, Whitbread profit inched up despite weakness in consumer demand, while Intu Properties reported a decrease in net asset value. Plus500 said its number of new customers fell in the third quarter, but it sees trading in 2018 ahead of expectations as market volatility is making its customers more active."European stock markets weren't able to hold onto their early gains yesterday, despite getting a decent tailwind from Asian stocks, as concerns about trade, geopolitics and the budget stand-off between Italy and the European Commission kept investors cautious," said CMC Markets chief market analyst Michael Hewson.This is set to flow through to Tuesday. IG says futures indicate the FTSE 100 index of large-caps to open 57.80 points lower at 6,985.00 on Tuesday. The FTSE 100 index closed down 0.1%, or 7.00 points at 7,042.80 on Monday.The European Commission on Tuesday will decide on its next steps in its spat with Rome over the Italian government budget.On Monday, Italian Economics Minister Giovanni Tria wrote in a letter that the Italian government is "conscious of having chosen a budget policy path that is not in line" with EU rules.Italy's ruling populist parties are planning to raise the deficit to 2.4% of gross domestic product, from 0.8% set by a previous government. This has raised concerns in Brussels and among investors because Italy's debt levels are already among the highest in the world, standing at more than 130% of GDP.In the UK, traders will be focusing on Brexit developments after sterling tumbled to a two-and-a-half week low overnight.Prime Minister Theresa May will brief the Cabinet on the progress of Brexit negotiations after last week's Brussels summit failed to achieve the hoped-for breakthrough.The UK prime minister told MPs on Monday the terms of Britain's withdrawal from the EU were 95% agreed but that the "sticking point" remained the issue of the Irish border.However, she came under fire from critics on all sides in the Commons after she confirmed that she could accept a short extension to the transition period after the UK leaves in order to secure a final settlement.Both pro-Leave and pro-Remain members of May's party expressed concern that it could leave the country trapped indefinitely in a transitional arrangement with no say in the rules governing it.Sterling was quoted at USD1.2953 early Tuesday - trading around its worse in a two-and-a-half week time - compared to USD1.2982 at the London equities close on Monday.In the US on Monday, Wall Street ended broadly lower, with the Dow Jones Industrial Average ending down 0.5% and S&P 500 shedding 0.4% but the Nasdaq Composite gaining 0.3%.In Asia on Tuesday, the Japanese Nikkei 225 index closed down 2.7%. In China, the Shanghai Composite is down 2.3% - pulling back from Monday's 4.1% gain - while the Hang Seng index in Hong Kong is down 3.0%.The economic events calendar on Tuesday has UK CBI Industrial Trends Survey figures at 1100 BST.In addition, Bank of England Governor Mark Carney will speak at the University of Toronto Fourth Annual Conference on the topic "Machine Learning and the Market for Intelligence" at 1620 BST.In early company news, Whitbread reported pretax profit of GBP257.4 million for the six months to the end of August, marginally higher than GBP256.8 million reported a year earlier, as revenue rose to GBP1.08 billion from GBP1.05 billion.The FTSE 100-listed hospitality company declared an interim dividend of 32.7 pence per share, up 4.0% from 31.4p paid the year before. Premier Inn delivered total accommodation sales growth of 4.8%, as it has added more than 14,000 new rooms in the UK. On a like-for-like basis, accommodation sales grew by 0.2%."Although we have seen some weakness in consumer demand over the summer, we have made further encouraging progress with our efficiency programme," said Chief Executive Alison Brittain.Intu Properties said triple net asset value per share as at September-end stood at 297p, down by 12p from the end of June, as a result of 3% fall in like-for-like property valuations in the period."We are however confident our business and assets are resilient and can weather the challenges we are currently seeing," said Chief Executive David Fischel. Last week, Intu received a takeover proposal worth 210.4p per share from a consortium comprising Peel Group, Olayan Group, and Brookfield Property Group.Also, in FTSE 250, Plus500 said trading for 2018 is now expected to be ahead of expectations, despite revenue in the third quarter falling by 14% to USD100.1 million. The number of new customers added in the three months to September 30 also declined by half to 20,684 from 42,492 reported for the same period a year before. However, the number of active customers was up 8% to 102,043. "Our results for the third quarter continued to show satisfactory levels of trading activity of our active customers in comparison to previous years, despite regulatory changes and low market volatility," said Chief Executive Asaf Elimelech.Related Shares:
Plus500INTU.LWhitbread