London pre-open: Stocks set for higher start on US stimulus hopes

(Sharecast News) - Futures are pointing to a positive start to the month and to the fourth quarter for stocks in London, buoyed by news overnight that US lawmakers were narrowing their differences over the proposed size of a fourth government stimulus package.
According to White House chief of Staff, Mark Meadows, the latest offer from the Trump administration is "certainly above the $1.5 trillion that has been articulated to date", versus the $2.2trn proposed by Democrats.

Analysts at UniCredit said such hopes were buoying market sentiment after the rollercoaster end to the third quarter.

Against that backdrop, as of 0745 BST, futures for the FTSE 100 were rising by 28.5 points to 5,870.

Chief on the economic calendar for Thursday were a raft of manufacturing sector surveys scheduled for release in the euro area, UK (at 0930 BST) and US.

A speech from European Central Bank chief economist, Philip Lane, at 1645 BST, will likely be also closely monitored after his boss at the ECB, Christine Lagarde, floated the possibility of reviewing the monetary authority's inflation target just the day before.

Covid-19 vaccines in focus at quarter's start

America's main health regulator, the Food and Drug Administration, has widened its investigation into the adverse event related to one patient in AstraZeneca's ongoing phase three clinical trial of its Covid-19 vaccine candidate, Reuters reported, which remains on hold in the States. While the expanded probe increases the chances of longer delays before a potential restart of the trial in that country, it does mean that the FDA thinks there were safety issues linked to the vaccine, rather that it intends to be through.

Aircraft engine maker Rolls-Royce has unveiled plans to raise at least £3bn to shore up its balance sheet in the face of the coronavirus pandemic. The company on Thursday announced a 10-for-three £2bn rights issue and £1bn bond offering. It has also agreed a new £1bn two-year term loan facility conditional upon the rights issue completing. Roll-Royce has been hammered particularly hard by the collapse in air travel as it is paid by the number of miles flown by aircraft using its engines.

Medical technology company Smith & Nephew announced on Thursday that it is expecting a third quarter underlying revenue decline of about 4%. The FTSE 100 company said all three of its franchises showed "significant" recovery, following an overall underlying revenue decline of 29.3% for the second quarter. It said the improvement was strongest in its orthopaedics franchise, as global levels of elective surgery continued to recover.