London pre-open: Stocks seen up ahead of US retail sales
(Sharecast News) - London stocks were set for a firmer open on Thursday after a positive session on Wall Street, as investors await the release of US retail sales figures.
The FTSE 100 was called to open 22 points higher at 7,038.
CMC Markets analyst Michael Hewson said: "Having got off to a positive start to the week on Monday, the last two days have been disappointing ones for European markets. Yesterday's weakness was driven by a surge in energy prices, which in turn is prompting concerns that rising prices will slow an already fragile recovery, by eroding disposable income for consumers. We could also see business profit margins getting hit as the costs of production, as well as transportation go up.
"US markets, on the other hand managed to see a smart rebound, with the S&P 500 rebounding off technical support at the 50-day MA, after European markets had closed. This turnaround in the US, hasn't translated into a positive Asia session, which are struggling on the back of concerns over the Chinese economy, as well as regulation.
"In Europe, we still look set for a positive open, despite the weak lead from Asia, and given the current uncertainty it's hard to escape the feeling that investors are struggling to find a narrative to justify pushing stocks higher."
On the macroeconomic front, investors will eye the release of US retail sales data for August later in the day.
In corporate news, Ashtead said its annual performance would beat its previous expectations as the equipment hire company reported a 53% increase in operating profit for the first quarter.
Operating profit for the three months to the end of July rose to $477m from $311m a year earlier at constant currency as revenue increased 21% to $1.85bn. Statutory pre-tax profit rose 74% to $416m. Revenue rose 13% at constant currency from the first quarter two years earlier when trading was unaffected by the pandemic. Ashtead said it expected annual rental revenue to increase by 13-16% - up from earlier guidance of 6-9%.
Games Workshop said trading for the three months to 29 August was in line with the board's expectations. The miniature wargames manufacture said sales continue to grow but, as with other businesses, there has been pressure on freight costs and currency exchange rates.
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