London pre-open: Stocks seen weaker after Bank Holiday break
By Michele Maatouk
Date: Tuesday 03 May 2022
(Sharecast News) - London stocks were set for a weaker open on Tuesday as traders return to their desks after the Bank Holiday weekend.
The FTSE 100 was called to open 60 points lower at 7,484.
CMC Markets analyst Michael Hewson said: "Asia markets got off to a poor start to the month yesterday, as did markets in Europe after the latest China PMIs showed that economic activity in April fell back by more than expected.
"US markets initially didn't fare much better, with the S&P500 coming off its worst month since March 2020, and the worst start to the since 1939, we saw the index sliding below its February lows, along with the Nasdaq 100, however a late recovery saw a big tech inspired rebound led by the Nasdaq 100, and a positive start to the month.
"The US 10-year yield also pushed higher pushing up to the 3% level, for the first since 2018.
"This is expected to translate into a mixed open for markets in Europe later this morning with the FTSE 100 set to fall as it plays catch up on yesterday's market declines for the DAX and CAC 40."
In corporate news, energy giant BP swung to a massive first quarter loss as a result of its decision to exit it Russia after the country's invasion of Ukraine.
It posted a replacement cost loss of $23bn, compared with a profit of $1.9bn a year ago and warned of "an ongoing elevated risk of oil price volatility" reflecting uncertainties around the level of disruption to Russian supply, the capacity for increased OPEC+ supply, the ongoing impact of COVID-19 on demand and the impact of the conflict in Ukraine on economic growth.
Avast said it expected annual revenue to slow and margins to be squeezed amid a "challenging global backdrop".
Organic revenue rose 3.6% to $230.8m in the first quarter as adjusted earnings before interest, tax depreciation and amortisation fell 4.3% to $127.9m. Revenue including acquisitions and disposals fell 1% to $234.6m. The cybersecurity group said it expected annual organic revenue to increase by low single digits and for the adjusted EBITDA margin to narrow to slightly less than 50% from 54.5% in the three months to the end of March.
Facilities manager Mitie Group has acquired 8point8, a British design and construction services provider for mobile telecoms tower infrastructure, for £10.0m in cash, funded through existing facilities.
Mitie said that with the growing demands of the UK's 5G rollout, the addition of 8point8 was expected to be accretive to earnings. Revenue was also expected to "grow significantly" over the next three-to-five years as the mobile telecoms industry replaces the currently installed Huawei infrastructure with a full 5G network.
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