FTSE preview: Shares up; Tesco results
The FTSE 100 is seen opening up after similar modest gains in Asia as investors applauded US President Barack Obama's compromise deal to extend all Bush-era tax cuts.
Taking stock: Shares should rise this morning.
However, lingering concerns over the euro zone debt crisis, and worries of a possible Chinese rate hike could help limit the gains.
China is likely to raise interest rates in the coming days in a demonstration of the government's resolve to tame inflation, an official newspaper said on Tuesday.
The UK blue chip index closed 24.96 points, or 0.4% higher on Monday at 5,770.28, its highest closing level since November 15 buoyed by strength in energy issues after crude reached a two-year peak. However China rate hike worries pulled the oil price lower overnight.
US stocks ended mixed on Monday, but futures moved higher after news late on of a 'framework' agreement between President Obama and Republicans that would renew tax cuts for two years not just for the middle class but also for wealthier Americans, as Republicans wanted.
Meanwhile, British retail sales growth slowed in November, as consumers proved reluctant to splash out on expensive items at a time of public spending cuts and higher taxes, a survey showed on Tuesday.
The British Retail Consortium said sales values were 0.7% higher than a year ago on a like-for-like basis. Total sales, which include new floorspace, were 2.8% higher.
Elsewhere on the macroeconomic front, British October industrial and manufacturing output numbers will be released.
US October consumer confidence and ISM manufacturing and non-manufacturing semi-annual economic forecasts will be unveiled.
Euro zone debt worries will remain a focus. After a five-hour meeting, the bloc's finance ministers said late on Monday they would be taking no new measures to tackle the contagion, saying the existing emergency fund was sufficiently big and that the proposal for euro zone bonds had not even been broached.
Investors were also braced for Ireland's budget vote. Prime Minister Brian Cowen is expected to get his fiscal plan through parliament and avert the risk of a snap election.
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HSBC continued to act for funds that fed money into Bernard Madoff's Ponzi scheme despite repeated warnings from the bank's own executives and outside auditors about the 'baffling' and potentially fraudulent structure of the fund, according to a US lawsuit launched against the global bank, The Financial Times said.
BP has approached several UK-focused energy companies about a potential sell-off of North Sea assets worth around $1bn, The Daily Telegraph said on Tuesday.
Workers at the world's No.3 copper mine, Chile's Collahuasi - owned by global miners Xstrata and Anglo American - returned to work on Tuesday after accepting a wage deal to end a 32-day strike, the longest-ever at a major private mine in the top producing country.
Junior stock market AIM is poised to launch an investigation into potentially misleading comments made last week by the Falkland Island explorer Desire Petroleum, the Daily Mail reported.
There will be results today from Tesco, Wolseley, Bellway, Innovation Group, Southern Cross Healthcare, Northgate, Victrex, Daisy Group, Dolphin Capital and DCD Media.
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