FTSE 100 preview: Shares up; UK debt due

 

The FTSE 100 is seen opening up 4-12 points after strong gains in the previous session, though moves are seen muted as investors await the outcome of a US Federal Reserve policy meeting, due after UK markets close.

A dealer monitors her screens on the trading floor of IG Index in London

Watching brief: Investors will watch public sector borrowing data.

The blue-chip index is seen gaining as much as 0.2% after it jumped 1.7% on Monday to close at 5,602.54, its highest since late April.

The Fed may discuss whether a shaky US economy needs a fresh infusion of cash, and although an easing is thought to be unlikely, there is an expectation that it will signal its readiness to act if necessary.

'Once again the fears of a double dip continue to ebb and even if the Fed does look to renew stimulus measures, consensus appears to be that this would be seen as positive by the market as a whole,' Ben Potter, market strategist at IG Markets in Melbourne said in a note to clients.

Domestically, investors will watch public sector borrowing data for August, for more clues on the state of Britain's public finances and prospects for a steady recovery.

Analysts point to technical support for the index near current levels. 'Despite a near-term pullback through the support of an intraday Rising Wedge, expect the bulls to support the FTSE between 5,589 and 5,607,' Raghee Horner, Autochartist chief market analyst said in a note.

BHP Billiton's $39bn battle to take control of Canada's Potash is expected to drag on into next year after it failed to win immediate backing from Canadian authorities.

Potash Corp said on Tuesday it still believed BHP Billiton's $39bn takeover offer substantially undervalued the company.

BP, which permanently sealed its ruptured Gulf of Mexico well this weekend, said on Monday it is joining the industry's $1bn effort to contain future subsea oil spills.

Minera Andes said on Monday it resolved a dispute with its partner Hochschild Mining over the repayment of loans for financing their San Jose joint venture in Argentina, sending the Canadian company's shares to a 26-month high.

British social housing maintenance company Mears is in the hunt to pick up more contracts previously held by stricken rival Connaught and pursue acquisitions, chairman Bob Holt said.

Tesco, the world's No. 3 retailer, plans to launch online shopping in China, the Czech Republic and Poland, its incoming chief executive told the Financial Times on Tuesday.

Barclays Capital, Barclays' investment banking arm has hired Sandeep Pahwa from Deutsche Bank as its new head of investment banking for Southeast Asia, sources said on Tuesday, as the British bank builds a deal-making team in the region.

Mongolian Prime Minister Sukhbaatariin Batbold said on Monday the London Stock Exchange is the front-runner in a bid to manage a new local stock exchange, expected to be up and running by year-end.

There will be updates today from JD Sports, Minerva and Wilmington Group.