London pre-open: Stocks seen lower as US election goes down to the wire
(Sharecast News) - London stocks were set to fall at the open on Wednesday as US election results come in and the 'blue wave' fails to materialise.
The FTSE 100 was called to open 27 points lower at around 5,760, with the election results too close to call and the final result not expected until Friday. So far, Democrat Joe Biden has 225 votes, while Republican Trump has 213.
CMC Markets analyst Michael Hewson said: "All of those expecting to see a blue wave sweep for the Democrats have quickly seen this notion disabused as early results come in, with the Republican vote holding up fairly well, and in areas where you wouldn't normally expect.
"The failure of the Democrats to capture the states of Texas and Florida, which they had high hopes of seizing control of, is likely to see the eventual outcome of this 2020 vote go to the wire, as the votes continue to get counted across the US. The Republicans appear to have also held onto Ohio.
"Financial markets, which had been hoping for a swift outcome after the uncertainty of the last few weeks are currently taking the failure of the Democrats to open up a clear lead in their stride, however that could change if we don't start to see a clear outcome by the end of the week.
"It also looks highly unlikely that the Democrats will gain control of the Senate, which they had hoped would give them a clean slate and free rein to unleash a multitrillion dollar fiscal stimulus plan."
In corporate news, UK retailer Marks & Spencer swung to a half-year loss as coronavirus lockdowns hit its clothing division.
The company posted a pre-tax loss of £87.6m from a profit of £159m a year earlier.
"There remains significant uncertainty regarding the near-term outlook in relation to both Covid and Brexit. Trading in the first four weeks of the second half has continued at similar rates to the end of Q2, with food revenue up 3%, C&H revenue down 21.5% and International revenue up 7.4% due to the timing of shipments," it said.
Smurfit Kappa said performance in the third quarter exceeded its expectations. The packaging company said it expected to report annual earnings before interest, tax, depreciation and amortisation between €1.46bn and €1.48bn and that it would pay a second interim dividend of 27.9 cents a share.
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