London pre-open: Stocks seen down on weak US, Asian cues
By Michele Maatouk
Date: Tuesday 31 Jan 2023
(Sharecast News) - London stocks were set to fall at the open on Tuesday following downbeat sessions in the US and Asia, and after the International Monetary Fund forecast a UK recession this year.
The FTSE 100 was called to open 18 points lower at 7,767.
CMC Markets analyst Michael Hewson said: "Yesterday's surprise increase in Spanish core inflation for January to record highs also appears to have raised concerns that high prices might not come down as quickly as thought, and growth a lot slower, despite the recent sharp falls in energy prices. With Asia markets also sliding back this morning, markets here in Europe look set to open lower as we come to the end of what has been a strong month.
"Later today we should get a better idea of whether the contraction in the German economy in Q4 was a localised issue, or symptomatic of more widespread economic weakness across the EU."
Investors will also be digesting the latest forecast from the IMF, which said UK GDP was set to shrink 0.6% this year, down 0.9 percentage point from October's forecast and the worst for any G7 country this year.
In corporate news, British American Tobacco said it was cutting the number of business units it operates and restructuring its regional set up as part of a strategic review.
The number of regions will be reduced from four to three, and the number of business units from 16 to 12, the maker of Peter Stuyvesant cigarettes said.
BAT's new structure will consist of three regions: USA (Reynolds American Inc.), Americas & Europe and Asia Pacific, Middle East & Africa.
Elsewhere, Pets at Home lifted its full-year profit guidance following record third-quarter consumer revenues.
The pet retailer said in an update that trading momentum remained robust into the fourth quarter, and with eight weeks of the year left to trade, it now expects FY 23 group underlying pre-tax profit to be towards the upper end of the consensus range of £126m to £136m. This is ahead of previous guidance of around £131m.
The company said group revenues rose 8.8% in Q3 to £347.5m, while consumer revenue was up 9% on the same period a year earlier, with growth underpinned by a record number of consumers and "pleasing" volume growth. Compared with pre-pandemic levels, consumer revenues were ahead more than 30%.
Johnson Matthey inked a long-term strategic partnership to supply Plug Power with the advanced materials necessary for its fuel cells and electrolysers from 2023.
Under the terms of the deal, the two companies would also invest jointly in 5Gw of new manufacturing capacity in the US with production expected to start in 2025.
The necessary capital outlays were in broad terms already foreseen in the group's capex guidance for 2024/25.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN