13th Jan 2015 07:05
LONDON (Alliance News) - London stocks are set to start lower Tuesday, shrugging off encouraging data from China and instead focusing on further falls in crude oil.
The FTSE 100 is called to open 19 points lower at 6,481.8. The index closed at 6,501.42, unchanged on the day.
Brent crude is quoted at around USD46.10 a barrel after touching a new five-and-a-half-year low of USD46.03 early Tuesday. US benchmark West Texas Intermediate was quoted at USD44.99 after hitting USD44.84, a level not seen since mid-March 2009.
"Another sharp decline in oil prices overnight weighed heavily on US energy stocks, while in Asia a better than expected trade balance update from China helped support stocks in the region," says Craig Erlam at Alpari.
China's trade surplus fell to USD49.6 billion in December from November's record high of USD54.48 billion. Economists had expected the trade surplus to decrease to USD49 billion. Exports grew 9.9% year-over-year in December, which was faster than the 6% rise expected by economists, helped by buoyant growth in the US. In November, exports had increased 4.7%.
Imports declined 2.3%, slower than the 6.2% drop forecast by economists. In November, imports had decreased 6.7%.
"We had expected the sharp falls in the price of oil and other commodities to have weighed more heavily on the value of imports, but it appears that this may have been partly offset by a pick-up in the volume of oil imports as China takes advantage of low prices to add to its strategic reserves," says Julian Evans-Pritchard, China Economist at Capital Economics.
UK consumer inflation figures and producer prices for December are due at 0930 GMT
In UK corporate news, retailers Debenhams, WM Morrisons Supermarkets, ASOS and Greggs release trading statements covering Christmas. Michael Page International, Cairn Energy and UK Mail also provide updates.
Japan's Nikkei closed down 0.6% at 17,087.71 after being closed for Coming of Age Day on Monday. The Hang Seng in Hong Kong is up 0.6% at 24,163.58, and the Shanghai Composite is down 0.1% at 3,226.303.
By Ian Edmondson; [email protected]
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