FTSE 100 preview: Shares rise on US data

 

The FTSE 100 is expected to rise, adding slightly to strong gains in the previous session, but with investors still cautious over the euro zone debt situation.

Dealers monitor their screens on the trading floor of IG Index in London

Watching brief: Better news from the US will help UK shares.

Data showing stronger consumer demand and lower than expected unemployment in the United States added to firm UK GDP data to push Britain's top share index 1.4% higher on Wednesday to close at 5,657.10.

But the FTSE 100 is only expected to gain as much as 0.1% early on Thursday as Asian stocks failed to get much support from the US data as uncertainty on the outlook for the euro zone following massive financial support for Ireland lingered.

Investors will watch UK November distributive trades data for more clues on the state of UK consumer spending. The sales balance is forecast at 33, down from 36 the previous month.

US stocks rose on Wednesday as US stock investors put aside worries about swirling global problems, turning to improvement in the labour market and signs consumers are ready to open their wallets ahead of the biggest shopping day of the year.

Trading is set to be subdued on Thursday, with Wall Street staying closed for the Thanksgiving Day holiday.

Japan's Nikkei average rose 0.5% on Thursday and edged back toward a five-month high hit earlier this week, supported by demand from overseas investors and the yen's recent dip against the dollar. However gains from other Asian equities were muted.

The administrator of BP's $20bn fund for victims of the worst US offshore oil spill on Wednesday encouraged claimants to file early for final settlements to get the most generous terms.

The chief executive Lloyds Banking Group has called on the coalition government to honour what he described as a pledge by its predecessor not to unwind the bank's controversial takeover of broken rival HBOS, the Financial Times said.

Indian and foreign phone companies, including Vodafone could be forced to pay more than $1bn each to the Indian government after a critical audit of a controversial allocation of mobile licences, the Financial Times cited two senior government officials as saying.

Thomas Cook will announce a deal on Thursday to acquire a stake in Russian travel agency Intourist in order to enter the fast-growing Russian travel market, Vedomosti daily reported.

Britain's main banks are working on a joint plan to cut bonus payouts this year and boost lending to small businesses in 2011, The Times newspaper said in its Thursday edition.

There will be results today from Antofagasta, WS Atkins, Daily Mail & General Trust, Dixons Retail, Grainger, Helical Bar, Pennon and Young & Co Brewery.

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