4th Oct 2013 06:45
LONDON (Alliance News) - UK equities are indicated marginally lower at the open Friday, following the decline of US and Asian markets Thursday, as the US shutdown enters its fourth day and concerns grow about the up-coming debt-ceiling deadline.
Another trading day is likely to be dominated by the US political stand off, with warnings of the economic risks of allowing the shutdown to continue come in from all quarters.
International Monetary Fund director Christine Lagarde said: "The Government shut-down is bad enough, but failure to raise the debt ceiling would be far worse. It is mission critical that this be resolved as soon as possible."
A report from the US Treasury warned that a default on national debt would be unprecedented and "has the potential to be catastrophic."
The dollar remains weak on the concerns, with the pound at USD1.6160 and the euro at USD1.3625, both close to eight month highs.
Overnight the Bank of Japan decided to hold its monetary easing programme unchanged, keeping interest rates and asset purchases steady, while also maintaining its economic assessment. "Japan's economy is recovering moderately," the central bank said.
The FTSE 100 is indicated 0.14% lower at 6432 points by IG Index.
A light day in the UK corporate calendar Friday, with trading updates from Tate & Lyle and Wood Group released. Barclays also said that 94.63% of its rights issue had been taken up.
In the data calendar, EU producer price index numbers are due at 1000BST. The US non-farm payroll numbers will not be released Friday due to the government shut-down. Speeches from US officials may provide some insight, however, with the Fed's William Dudley speaking at 1415BST and FOMC member Jeremy Stein at 1430BST.
By Jon Darby; [email protected]; @jondarby100
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