FTSE preview: Shares follow US higher
The FTSE 100 is seen gaining on Wednesday, following a speech in which President Barack Obama stressed the need to lower corporate tax rates, and after Wall Street erased losses on general optimism about earnings.
Taking stock: Shares have had to cope with dismal economic data.
The UK blue chip index looks set to add 27 to 29 points, or 0.5%, according to financial bookmakers.
It closed down 26.14 points, or 0.4%, at 5,917.71 on Tuesday after a shock 0.5% contraction in UK GDP in the last three months of 2010.
Bank of England Governor Mervyn King said on Tuesday that British inflation is likely to rise towards 5% in the coming months, but any decision to raise interest rates will be based on longer-term goals.
The publication of minutes from January's Bank of England Monetary Policy Committee meeting is due.
US stocks pared losses in a late flurry of buying to end little changed on Tuesday.
About 70% of S&P companies so far have beaten estimates, but worries about inflation cutting into profits have caused investors to jump on shares of companies that only produce spectacular results.
In his State of the Union address to Congress, Obama called on lawmakers to work with him to cut the corporate tax rate, and simplify the tax code by eliminating loopholes favorable to specific industries while lowering overall rates.
Investors were waiting for US December new home sales data and the outcome of the latest two-day Federal Reserve Open Market Committee meeting, due after the London close.
The Fed is expected to nod to an improving US economic outlook even as it reaffirms a plan to buy $600bn in government debt to help speed recovery.
Ex-dividend factors will take 1.7 points off the FTSE 100 index on Wednesday, with Compass Group and Scottish & Southern Energy both losing their payout attractions.
News Corp is thought to have submitted a 'solid structural remedy' to address government concerns over its proposed takeover of BSkyB in a last-minute attempt to persuade the government to drop a lengthy investigation into the bid, the Daily Telegraph said.
TUI Travel, Europe's biggest tours operator, is facing a shareholder backlash over the appointment of PricewaterhouseCoopers as group auditor in the wake of a £117m accounting hit, the Times said.
Four Russian industrial and mining companies are set to list in London within the next few weeks, joining 40 Russian peers on London's main market, the Financial Times said.
BP reported a unit upset at its 405,000 barrels-per-day refinery in Whiting, Indiana on Tuesday, according to a filing with regulators. The unit upset led to flaring of process gases.
There was talk that online gambling firm PartyGaming signed a lucrative deal with one or two large US casinos to provide them with online poker platforms for the US market when it is regulated, the Daily Mail market report said.
Alan Grisay, chief executive of F&C, has warned that the asset manager could 'go under' if activist investor Ed Bramson takes control of the company's board next week, the Daily Telegraph said.
There will be updates today from United Utilities, Sage Group, Capital Shopping Centres, Renishaw, WH Smith and System C Healthcare.
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