4th Nov 2013 07:46
LONDON (Alliance News) - UK stocks are set to open higher Monday as investors turn their attention towards later in the week, with the European Central Bank's monetary policy statement on Thursday expected to signal looser monetary policy.
"Last week's sharp declines in the euro have been blamed on the expectation that the ECB will either cut rates this week, or signal its intention to loosen policy further in the coming weeks," says Michael Hewson, chief analyst at CMC Markets.
While Hewson believes that it is unlikely that the ECB will do anything to alter its rates this week, the expectation of a looser policy, and subsequent expansion of money supply, is set to see markets open higher Monday.
However, "this expectation could well be tempered by uncertainty about the timing on Fed policy after better-than-expected October Chicago PMI and ISM numbers at the back end of last week," Hewson warns.
Strong Chinese data was released over the weekend. A combined survey by the China Federation of Logistics and Purchasing and the National Bureau of Statistics revealed that the world's second largest economy's non-manufacturing sector expanded at a faster pace in October.
The PMI for the service sector moved up to 56.3 in October from 55.4 in September. In August, the score was 53.9. Looking ahead, non-manufacturing firms expect their business conditions to improve in the next three months.
Both CMC Markets and IG indicate the FTSE 100 to open higher Monday at approximately 6,750 points.
In the data calendar Monday, there is a raft of Markit manufacturing PMI readings from across Europe. Italian data is due at 0843 GMT, with French PMI at 0848 GMT, German PMI is scheduled at 0853 GMT, ahead of the EU figure at 0858 GMT. Alongside this, UK PMI construction is expected at 0930.
In the US, ISM New York data is expected at 1445 GMT, ahead of factory orders information at 1500 GMT.
In the corporate calendar, blue-chip Weir Group has been joined by FTSE 250-listed Telecity Group and Hiscox in reporting interim management statements prior to the London open Monday. HSBC is
By James Kemp; [email protected]; @jamespkemp
Copyright 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
Weir GroupHiscox