London pre-open: Stocks to fall as markets watch Middle East tensions
By Benjamin Chiou
Date: Monday 15 Apr 2024
(Sharecast News) - UK stocks are expected to fall in early trading on Monday with investors likely to keep close eyes on the evolving situation between Israel and Iran, after Tehran launched drones and missiles overnight.
The FTSE 100 was being called to open 0.3% lower after finishing Friday's session at 7,995.58.
In a retaliation for a strike on the Iran consulate in Damascus, Iran launched more than 300 drones and missiles at Israel on Sunday evening, though nearly all were intercepted by air defence operations with the help from US, UK, France and Jordan.
Markets will now be watching how Israel responds. The US has warned Israel that it would not join in with any retaliatory action, while UN secretary general Antonio Guterres said: "Now is the time to defuse and de-escalate. Neither the region nor the world can afford more war."
"The unprecedented Iranian attack on Israeli targets casts a shadow over the economic and financial outlook beyond the region itself," said Berenberg economist Holger Schmieding. "The risk that the conflict in the Middle East may escalate further has increased. Attention focusses on the Israeli reaction to the Iranian strike."
In other macro news, Monday's economic data schedule looked relatively light, with Eurozone industrial production and US retail sales the only major releases of the day.
On the corporate front in London, Great Portland Estates announced that British luxury retail brand Represent will open its new 5,000 square foot flagship store at its property at 135/141 Wardour Street in Soho. The FTSE 250 company said the two-floor space, set to open in early 2025, would be Represent's second global store after its Los Angeles location. It said Represent had committed to a 10-year lease, without divulging any of the deal's financial details.
B&Q and Screwfix owner Kingfisher has revealed that chair Andrew Cosslett will step down after seven years at the helm of the board. Cosslett has decided not to stand for re-election at the company's AGM in June and will be succeeded by Claudia Arney, who has been an independent non-executive director since 2018 and is currently chair of the remuneration committee. Arney is said to bring "a wealth of experience of business transformation and building digital capabilities", having previously served as interim chair of the Premier League and other non-executive roles at Halfords, Ocado and Aviva.
PageGroup reported lower first-quarter gross profit as the economic slowdown continued to hit the jobs market. The recruitment firm on Monday said gross profit for the first three months of the year fell 12.9% to £219.7m on an annual basis, with UK and Asia-Pacific operations down 19.2% and 22% respectively. "Conversion of final interviews to accepted offers is still the most significant challenge, as candidate and client sentiment remains subdued reflecting the general macro-economic uncertainty in most of our markets," said chief executive Nicholas Kirk.
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