London pre-open: Stocks seen higher amid trade optimism; retail sales eyed
By Michele Maatouk
Date: Friday 18 Jan 2019
(Sharecast News) - London stocks were set for a positive open on Friday amid signs that trade relations between the US and China could be improving.
The FTSE 100 was called to open 30 points higher at 6,864.
Sentiment was set to be underpinned by a report that the US might consider easing some trade tariffs against China.
"These reports suggested that Treasury Secretary Steve Mnuchin was pushing the idea, though chief trade negotiator Robert Lighthizer was lukewarm at best on it," said CMC Markets analyst Michael Hewson.
"While there hasn't been any solid confirmation that this might happen one way or the other, the mere prospect of further progress was enough to propel US markets to new one-month highs. This in turn should help markets here in Europe open higher this morning."
On home shores, Brexit will continue to be the main event, although there will be a distraction in the form of UK retail sales data for December at 0930 GMT.
"Sales are expected to remain steady at an impressive 3.8%," said London Capital Group analyst Jasper Lawler. "Given that retail sales are considered an indication of future inflation, a print at this level could send sterling higher."
In corporate news, safety, health and environmental technology group Halma said it had bought Rath Communications, a provider of emergency communication systems for areas of refuge in the US, for $42.4m (£32.6m), on a cash and debt free basis.
An area of refuge is a location in a building designed to hold occupants during a fire or other emergency, when evacuation may not be safe or possible.
Rio Tinto said it shipped 2% more iron ore last year, while copper production increased by a third after a solid final quarter of the year.
The group said the negative impact to profits from raw material input price inflation, particularly in the aluminium business, had continued in the second half of 2018.
Cloud-enabled security software provider Sophos Group updated the market on its trading for the nine months ended 31 December on Friday, reporting 2% growth in constant currency billings for both the third quarter the year-to-date.
The company said revenue improved 14% year-to-date on both a reported and constant currency basis, which was primarily driven by continued growth in subscription revenue. Profitability was also significantly improved, with adjusted operating profit up 157% year-to-date.
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