London pre-open: Stocks seen down as investors eye Fed speak
By Michele Maatouk
Date: Thursday 25 Sep 2025
(Sharecast News) - London stocks were set to fall at the open on Thursday, having enjoyed a late rally into the close a day earlier as miners were boosted by rising copper prices.
The FTSE 100 was called to open down around 25 points.
Patrick Munnelly at Tickmill Group said: "Global stock markets appear to be hitting a pause as investors grapple with concerns over high valuations, this comes in the wake of a surge that has seen markets rise relentlessly recently.
"Wall Street recorded its second consecutive day of losses, offering little inspiration for Asian markets, where stocks largely moved within narrow ranges. Bucking the trend, Chinese blue-chip stocks surged, fuelled by their alignment with the global wave of AI-driven investments. Asian stocks have soared 9% this quarter, with Japan's Nikkei surging an impressive 13%, sparking speculation about potential month-end or quarter-end rebalancing flows.
"Adding to the markets more cautious tone is the stance adopted by several Federal Reserve officials on the timing of rate cuts. Futures now point to a 92% chance of a Fed rate cut in October, though expectations for total easing have scaled back to 100 basis points from 125 basis points just weeks ago.
"San Francisco Fed President Mary Daly, mirroring the views of her colleagues, acknowledged the need for further rate cuts but stressed uncertainty surrounding their timing. Investors are eagerly awaiting more clarity, as key Fed officials, including New York President John Williams, are set to speak later today, potentially offering fresh insights into the board's dovish outlook amid President Donald Trump's relentless scrutiny."
In corporate news, defence contractor Babcock International reaffirmed its full-year outlook after an "encouraging" start to the year.
Updating on trading, the blue chip said organic revenue growth and underlying operating margin progress had both been in line with expectations in the five months to August end.
Its nuclear and aviation divisions performed particularly well. In nuclear, it secured a £114m contract to the support the defueling of a decommissioned British submarine over 20 years, while aviation benefited from the ramp up of the French Mentor 2 contract.
Babcock also secured an eight-year contract with the Australian Border Force, to enhance maritime security operations in the Torres Strait.
Safety equipment group Halma said year-to-date trading has remained in line with expectations, leading it to reiterate full-year guidance despite mixed regional performance and ongoing macroeconomic uncertainty.
The FTSE 100 firm continues to expect "good organic constant currency revenue growth" for the year ending 31 March 2026, with adjusted pre-tax profits also set to be in line with market forecasts.
Revenue growth was strongest in the US, supported by robust demand across its Safety and Environmental & Analysis sectors. However, trading in mainland Europe was described as more challenging, while the UK and Asia Pacific delivered modest growth.
Pub group Mitchells & Butlers held annual guidance on the back of a 4.2% rise in like-for-like sales in the year to date despite weaker trade within Greater London and its premium businesses.
The Harvester and Toby Carvery owner forecast higher overall cost inflation next fiscal year of around £130m, or 6% of its cost base, but expected to outperform the sector via cost efficiencies.
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