6th Feb 2015 07:28
LONDON (Alliance News) - London stocks are set to open lower Friday as investors continue to focus on Greece's struggle to renegotiate the terms of its debt bailout and await the US nonfarm payroll report later in the session.
IG indicates the FTSE 100 to open 26.03 points lower at 6,839.9. The index closed up 0.1% at 6,865.93 on Thursday as a rise in oil prices supported oil-related stocks, but investor sentiment was subdued after the European Central Bank said it would refuse to accept Greek government bonds as security for loans.
Following talks on Thursday with German Finance Minister Wolfgang Schaeuble, known for his hardline stance on eurozone fiscal issues, Greek Finance Minister Yanis Varoufakis called for "bridging" finance until a new agreement between Athens and its lenders could be negotiated. He said he was not seeking to have any of Greece's sovereign debt wiped out.
"We didn't reach agreement. It was never on the cards that we would agree. We did not agree to disagree: We agreed to enter into negotiations," he said. Schaeuble had earlier said the diplomatic phrase for the encounter should be "agree to disagree".
"Europe?s markets look set to open slightly lower heading into the weekend with investors content to sit on the sidelines until the players in this little saga start to agree a narrative they all agree on, and move forward with," says Michael Hewson, chief market analyst at CMC Markets.
Brent oil continues to hold onto its gains made Thursday to trade at USD57.51 a barrel ahead of the London equity market open. US benchmark West Texas Intermediate is quoted at USD51.50.
Wall Street ended strongly Thursday, with the DJIA closing up 1.2%, the S&P 500 up 1.0%, and the Nasdaq Composite also up 1.0%.
In Asia on Friday, the Japanese Nikkei closed up 0.8%, while the Hang Seng trades down 0.3%, and the Shanghai Composite is down 1.9%.
German industrial production grew at a slower-than-expected rate in December. A report released by the Statistisches Bundesamt Deutschland said production grew month-on-month by 0.1%, the same as the revised figure for November. The sector was expected to show a growth of 0.4%.
GlaxoSmithKline on Friday said it has received positive results from the phase 3 study investigating the combination of the dabrafenib and trametinib drugs. Glaxo said the overall survival rates from the combination of the drugs showed a statistically significant fall in the risk of death from combining the pair in comparison to dabrafenib monotherapy in patients with BRAF V600E/K mutation-positive metastatic melanoma.
FTSE 100-listed outsourcing company Capita said it has been approved to join the lead provider framework for NHS England's commissioning support services. Capita said clinical commissioning groups in the UK will be required to re-procure many support services by April 2016 in order to comply with European procurement law. The company added that NHS England anticipates this will result in GBP3 billion to GBP5 billion in services being procured through the framework.
Poundland Group said it has struck a deal to buy rival 99p Stores for GBP55 million in cash and shares. The FTSE 250-listed company said it will pay GBP47.5 million in cash for its fellow high-street discounter, along with a further GBP7.5 million in shares. Based on its closing price of 357.8 pence on Thursday, that would see Poundland issue 2.1 million shares.
In the economic calendar, the focus will be on US nonfarm payrolls, unemployment rate and earnings data at 1330 GMT. There will also French and UK trade balances for December at 0745 GMT and 0930 GMT respectively.
By Neil Thakrar; [email protected]; @NeilThakrar1
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