FTSE preview: Shares lower on Euro debt fear
The FTSE 100 is seen opening down 41-46 points, or 0.8% on Monday, according to financial bookmakers, carrying over Friday's late sell-off in tandem with falls on Wall Street and declines overnight in Asia as euro zone debt worries persist.
Blue Monday: Shares will follow global markets lower.
The UK blue chip index closed 7.50 points, or 0.1% lower on Friday at 5,948.49, having reversed from a session high of 6,017.56 as the financial sector took a knock after ratings agency Fitch downgraded Greece's credit rating, further fuelling fears the country will have to restructure its debt.
The threat of euro zone debt contagion was also raised by a move from credit ratings rival Standard & Poor to cut its outlook for Italy to 'negative' from 'stable' on Saturday.
US blue chips fell on Friday as investors' risk appetite was sapped by the euro-zone debt worries, while retailers lost ground after a weak profit outlook from Gap.
And Asian stocks fell on Monday as waning investor appetite for risk sparked a rush into safe-haven assets like government debt.
The Bank of England must start to raise interest rates from record lows to tackle inflation or risk damaging the economy, its chief economist Spencer Dale said in an interview with the Financial Times newspaper at the weekend.
'I don't take lightly the impact this could have on some families. But I think the cost to our economy as a whole - were inflation to persist for longer and our credibility start to be eroded - would be even worse,' he was quoted as saying in Saturday's edition.
No important British economic data will be released on Monday, so investors will be focused ahead to second readings for first-quarter growth numbers, due on Wednesday for the UK, and on Thursday for the US.
April's Chicago Fed index will be released at 1230 GMT on Monday.
Technical analysis of the FTSE 100 index remained cautious. 'Although Friday's rally to 6,017.56 took out the previous day's high, the lower close suggests that investors may be using the rallies to close out long positions or aggressive shorts are using the opportunity to refresh their positions,' said James A. Hyerczyk, analyst at Autochartist.
'Investors should look for an early test of the downside target zone. Strong momentum may even push the market lower, putting the index in a position to challenge the main bottom at 5,858.00 over the near-term,' Hyerczyk added.
Royal Dutch Shell sees deep-water oil drilling continuing in the future and as of next year will produce more gas than oil, its chief executive was quoted as saying by a Swiss newspaper on Sunday.
National Grid said it was not planning to sell its US arm, following a report in The Mail on Sunday that Britain's biggest energy distributor was mulling a sale of Niagara Mohawk Power for over £1bn.
WM Morrison will look into buying Iceland Foods as an auction for a controlling stake in the frozen food retailer gets under way, a person familiar with the situation said on Sunday.
US retailer Wal-Mart Stores is setting up a team in London to drive expansion into Europe, The Independent on Sunday newspaper reported. A Wal-Mart spokeswoman told Reuters the report was 'speculation dressed up as fact'.
London Stock Exchange Chief Xavier Rolet welcomed a decision by the LSE's merger target TMX Group to reject a rival takeover bid, clearing a key hurdle in a deal it needs to compete globally.
FTSE said, after the market close on Friday, that Invensys will be demoted from the FTSE 100 index with effect from May 25 to make way for the addition of Glencore to the UK blue chip index.
There will be results today from British Land, Mitie Group, Stobart Group, Vectura and Ffastfill.
Most watched Money videos
- BMW meets Swarovski and releases BMW i7 Crystal Headlights Iconic Glow
- Volvo's Polestar releases new innovative 4 digital rearview mirror
- Skoda reveals Skoda Epiq as part of an all-electric car portfolio
- How to invest for income and growth: SAINTS' James Dow
- Tesla unveils new Model 3 Performance - it's the fastest ever!
- Mercedes has finally unveiled its new electric G-Class
- 'Now even better': Nissan Qashqai gets a facelift for 2024 version
- 2025 Aston Martin DBX707: More luxury but comes with a higher price
- Land Rover unveil newest all-electric Range Rover SUV
- Blue Whale fund manager on the best of the Magnificent 7
- Mini Cooper SE: The British icon gets an all-electric makeover
- Mini celebrates the release of brand new all-electric car Mini Aceman
- Avon Protection handed £38m gas mask contract by MoD
- Ford confirms it will cull another of its best-selling...
- Bank of England paves way for Britain to cut interest...
- Watches of Switzerland buys Italy's Roberto Coin Inc for...
- ITV hit by Hollywood strikes as it pins hopes on Euros...
- Why we need more than a British Isa to move the dial on...
- Mortgage rates are climbing again - should we be worried?...
- Used car sales hit a five-year high as fresh supply of...
- BUSINESS LIVE: BoE base rate decision; ITV eyes ad market...
- BAE Systems tools-up for growth as Britain plots defence...
- Vodafone told to boost security as £15bn Three merger is...
- ITV hopes for summer ad boom as it continues to reel from...
- Takeover target Wood Group hit by slump in revenues as...
- Cameron left red-faced as Greensill sues Government over...
- BBVA goes directly to shareholders as it steps up bid for...
- Bailey pulls his punches on interest rates yet...
- MARKET REPORT: North Sea giant Harbour closes in on £9bn...
- Snoop Dogg cannabis firm to ditch London after losing 97%...