28th Feb 2014 07:40
LONDON (Alliance News) - UK stocks are called to open higher Friday, following on from a positive close on Wall Street Thursday and also buoyed by comments made on Thursday by new Federal Reserve Chair Janet Yellen.
Having spent much of Thursday's trading session in the red, stocks in the UK and Europe were lifted by Yellen's testimony before the Senate Banking Committee.
"All it took was for Fed chief Janet Yellen to acknowledge the possibility that the recent weather may well have had a negative effect on recent economic data," says Michael Hewson, chief market analyst at CMC Markets.
The speech also lifted US equities, and pushed the S&P 500 up 0.5% to end the day at a record high closing level of 1,854.29. The DJIA and NASDAQ Composite closed up 0.5% and 0.6% respectively.
Asian stocks also are largely positive. Ahead of the London equity market open, the Hang Seng is up 0.1%, with the Shanghai Composite index up 0.3%. Bucking the trend, the Nikkei in Tokyo is down 0.6%.
IG and Spreadex indicate that the FTSE 100 will open slightly higher at approximately 6,820 points, having closed up at 6,810.27 on Thursday.
In data just released, house prices in the UK increased at a notably faster pace in February, and to a greater extent than forecast by economists. The house price index advanced 9.4% annually, after gaining 8.8% in January, the Nationwide Housing Society said. Economists were looking for a 8.9% rise for February. Prices have now increased for the twelfth month in a row.
German retail sales also grew more than expected. Retail sales grew a calendar-and-seasonally adjusted 2.5% month-on-month in January, reversing a 2.1% decline in December. Economists had expected a 1% gain.
However, "euro area preliminary inflation data for February will be the key focus this morning," says Carl Paraskevas, senior international macroeconomist at Lloyds Banks.
Following on from Thursday's lower-than-expected German CPI reading, eurozone consumer price inflation, released at 1000 GMT, is expected to ease to 0.7% in February, down from 0.8% in January.
"Another weak inflation reading would inevitably heighten speculation of a possible European Central Bank policy response at next week?s Council meeting," says Paraskevas.
At the same time, Eurostat releases the eurozone unemployment rate information for January, which is expected to remain steady at 12%.
Also in the data calendar Friday, Italian CPI preliminaries for February and unemployment rate for January are released at 1000 GMT.
In the afternoon, the second preliminary reading of US gross domestic product is released at 1330 GMT. US personal consumption figures are released at the same time, ahead of the Reuters/Michigan consumer sentiment index at 1455 GMT. US pending home sales numbers for January are released at 1500 GMT.
In corporate news, FTSE 100-members Mondi, Old Mutual and Pearson have been joined by mid-caps Interserve, Berendsen, Laird, Intu Properties, Rentokil, Rightmove, Synthomer and UBM, amongst others, in releasing full-year results for 2013. Stagecoach Group has released an interim management statement.
Blue-chip William Hill, which, ahead of the FTSE quarterly review in March, is the second smallest company in the FTSE 100 by market cap, said that its pretax profit edged up to GBP277.7 million in 2013 from GBP274.2 million in the previous year. Group revenue rose to GBP1.28 billion, up from GBP1.25 billion in 2012.
By James Kemp; [email protected]; @jamespkemp
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