12th Nov 2013 13:39
LONDON (Alliance News) - US stocks are set to follow UK and European equities modestly lower Tuesday after German and UK inflation data for October slowed by more than expected.
Final figures released by the Federal Statistical Office early Tuesday showed Germany's EU harmonized inflation weakened in October. The harmonized index of consumer prices advanced 1.2% in October from the same month of last year, slightly slower than the 1.3% gain the government had estimated. In September, prices had recorded a 1.6% increase.
UK inflation also slowed more than expected to a level last seen in September 2012, easing the squeeze on purchasing power of consumers, official data showed. Driven by falling petrol prices, consumer price inflation dropped to 2.2% from 2.7% in September, the Office for National Statistics said. The figure came in below the 2.5% market consensus and was the weakest since November 2009. It also matched the September 2012 level.
The pound sank in the wake of the release and continues to be under pressure. Prior to the US equity market open, the pound trades at EUR1.1844, CHF1.4602 and USD1.5901.
Ahead of the New York bell, the FTSE 100 is down 0.3% at 6,706.6, the FTSE 250 is down 0.2% 15,384.88, while the AIM All-Share is down 0.1% at 810.44. On the continent, the French CAC and German DAX are both down 0.2%.
Similar muted sentiment is expected on Wall Street, both the S&P 500 and DJIA are expected to open 0.2% lower, while the Nasdaq Composite is called to open 0.3% lower.
At the individual UK stock level, AIM-listed Savile Group, up 115%, is a big gainer. Penna Consulting PLC said it has made a recommended GBP1.1 million cash takeover offer for the company. In a joint statement, Penna and Savile said they had agreed a deal which will give Savile shareholders seven pence a share in cash, more than double Savile's closing share price of 3.25 pence Monday. Penna said it already has irrevocable undertakings to accept the offer from shareholders with 27.3% of Savile's outstanding shares.
In the US, Redbook index numbers are scheduled for 1355 GMT.
By James Kemp; [email protected]; @jamespkemp
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