7th Mar 2014 07:34
LONDON (Alliance News) - UK equities are set to open flat to slightly higher Friday as investors adopt a wait-and-see approach ahead of the highly-anticipated US non-farm payrolls release later in the day.
It was another record-breaking day on Wall Street Thursday, where the S&P 500 ended the day at yet another record closing high, although Asian indexes are mixed with the Hang Seng marginally higher, while the Shanghai Composite index is down 0.1%. The Nikkei in Tokyo closed up 0.9%.
"Once again the overall narrative has been maintained with respect to latching onto the positive economic numbers and disregarding anything that deviates away from the overall belief that the weather is solely responsible for any weakness in the economic data," Michael Hewson, chief market analyst at CMC Markets said of Thursday's US session.
Markets shrugged off Thursday's weaker-than-expected US factory orders data for January and a downward revision for December, with the DJIA closing up 0.4% and the S&P 500 closing up 0.2%. The NASDAQ Composite, however, underperformed, closing fractionally lower.
In London, the FTSE 100 is indicated to open fractionally higher by CMC Markets and IG. The blue-chip index is called to open up at approximately 6,792 points, having closed at 6,788.49 on Thursday.
"The focus remains on the US economy again Friday and the latest US employment report for February," says Hewson.
Economists are expecting the non-farm payrolls to reveal an addition of 150,000 jobs in February, following the addition of 113,000 jobs in January, according to forecasts on FXStreet.com.
However, "with most economic data currently being distorted by unusually cold weather, it is likely that weak numbers will have less of an impact on markets than would normally be the case," says Rhys Herbert, senior international macroeconomist at Lloyds Bank.
"A weak number probably will (also) not have much immediate impact on Fed policy," he says. "A number of FOMC members have noted the uncertainties in current data and the need to be patient and look through these. We take that as meaning that the Fed is likely to continue to taper by USD10 billion at its March meeting."
The jobs data is released at 1330 GMT, at the same time as the country's unemployment rate and trade balance data is put out.
Germany's wholesale prices declined at the fastest rate in three months in January. The wholesale price index dropped 1.7% year-on-year, after a 1.3% fall in December, the fastest decline since October's 1.8% decrease. Month-on-month, wholesale prices slid 0.1% in January, reversing a 0.3% gain in the previous month.
The release did little to the euro. Ahead of the UK stock market open, the single currency trades at USD1.3859, CHF1.2185 and JPY142.639, while the pound trades at EUR1.2070.
Also in the data calendar Friday, French trade data is released at 0745 GMT. The Bank of England releases its consumer inflation expectations at 0930 GMT, ahead of German industrial production numbers at 1100 GMT.
The President of the Federal Reserve Bank of New York William Dudley is scheduled to give a speech after UK equity markets have closed.
In the lightest corporate calendar for several weeks, FTSE 250-listed Alliance Trust has released full-year results for 2013.
By James Kemp; [email protected]; @jamespkemp
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