Date: Tuesday 25 Nov 2014
LONDON (ShareCast) - UK stocks are set for only modest gains early on, with City sources predicting the FTSE 100 will open around three points higher than yesterday's close of 6,729.79.
"A cautious yet positive start to the day is expected for the European markets today, following the establishment of record highs in the US and a largely positive session overnight in Asia," Alpari market analyst Joshua Mahony said.
Overnight, the minutes of the latest Bank of Japan meeting were released, revealing the details of its decision to increase its rate of asset purchases from Y50trn per month to Y800trn in a five-to-four vote.
The minutes of the meeting revealed a high level of anxiety over the decision.
"This narrow victory for the doves, alongside a clearly apprehensive narrative running through the committee meant that for the time being, it is unlikely we are set to see another such move in the next few months," Mahony continued.
"However, with a speech from Kuroda today driving home the point that he would not hesitate to implement further quantitative easing should the Japanese economy need it, there is clearly an ultra-dovish Governor in charge at the BoJ and this can be a decisive factor when trying to push through less unanimous policy changes as was the case at the last meeting."
Meanwhile, Tuesday's session will also see the release of the final reading of the German gross domestic product (GDP) figure, with the data expected to show a confirmation of 0.1% month-on-month growth. US GDP estimates are also due out later on.
In company news, first half results from Severn Trent were in line with expectations as underlying profit rose 3%, while discussions with regulator Ofwat about the upcoming price remained "constructive". Turnover rose 2.7% to £947.6m, with underlying group profit before interest and tax was up 3.0% to £274.9m and adjusted earnings per share up 12.6% to 52.6p
Half-year revenue jumped 25% at AO World thanks to a strong performance by its own-brand website sales. In the six months to 30 September, the domestic appliances retailer saw overall turnover climb from £173.5m to £217.1m, driven by a 38.6% jump in AO.com sales.
B&Q and Screwfix owner Kingfisher saw like-for-like (LFL) trends deteriorate in the third quarter as decent growth in the UK and Ireland was offset by falling sales in France. The company, which is the largest DIY retailer in Europe and third-largest in the world, reported group sales of £2.82bn in the 13 weeks to 1 November, 3.6% lower than the year before due to adverse currency movements. LFL sales fell by 0.9%, compared with the 1.8% growth seen in the first half.
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