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(Alliance News) - Stocks in London were called higher on Friday, as European markets look set to follow Asia and America higher.
In early corporate news, Associated British Foods continues to open new Primark stores, and Anglo American expects mine production to dip in 2022.
"Activity on FTSE and European index futures hint at a slightly positive start on Friday. The US PPI data will, however, say the last word," said Swissquote Bank's Ipek Ozkardeskaya.
The US producer price index is due out at 1330 GMT on Friday.
US factory gate inflation is expected to cool to 7.4% in November from 8.0% in October, according to FXStreet-cited market consensus.
"If this is the case, if the factory gate inflation in the US slowed last month – which would also hint at a potentially slower CPI data next Tuesday before the [Federal Open Markets Committee] decision – we could see the risk assets shrug off some of this week’s weakness," Ozkardeskaya added.
The US consumer price index for November is due out on Tuesday next week.
"But if the US PPI figure is higher than expected – which is well possible given that the low expectations are harder to beat - then we will probably see the US stocks sink back in the red," she said.
Here is what you need to know ahead of the London market open:
MARKETS
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FTSE 100: called up 17.7 points, 0.2%, at 7,489.87
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Hang Seng: up 2.4% at 19,913.20
Nikkei 225: closed up 1.2% at 27,901.01
S&P/ASX 200: closed up 0.5% at 7,213.20
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DJIA: closed up 183.56 points, or 0.6%, at 33,781.48
S&P 500: closed up 29.59 points, or 0.8%, at 3,963.51
Nasdaq Composite: closed up 123.45 points, or 1.1%, at 11,082.00
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EUR: up at USD1.0575 (USD1.0547)
GBP: up at USD1.2261 (USD1.2218)
USD: up at JPY136.00 (JPY135.56)
GOLD: up at USD1,795.87 per ounce (USD1,787.73)
OIL (Brent): flat at USD76.74 a barrel (USD76.38)
(changes since previous London equities close)
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ECONOMICS
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Friday's key economic events still to come:
08:00 CET Germany labour cost index
09:30 GMT UK BoE and Ipsos inflation attitudes survey
08:30 EST US PPI
10:00 EST US monthly wholesale trade
10:00 EST US University of Michigan survey of consumers
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UK Chancellor Jeremy Hunt is set to launch a major reform of the UK's financial sector with plans to rip up red tape and replace reams of EU regulations. Dubbed the "Edinburgh reforms", the changes will be announced by the chancellor in the Scottish city on Friday as he heralded the "golden opportunity" Brexit provided to reshape the rules governing the financial sector. Hunt will set out a package of more than 30 regulatory reforms, with plans to "review, repeal and replace" hundreds of pages of EU regulations ranging from disclosure for financial products to prudential rules governing banks.
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The average UK rent for a new letting has jumped by GBP117 per month since last year, according to a property website. This has pushed the typical rent to GBP1,078 per month, Zoopla said, which equates to 35% of the average income of a single earner – the highest level in more than a decade. Rents have been rising particularly sharply in cities such as in London, Manchester, Birmingham, Glasgow, Bristol and Sheffield over the past year, Zoopla added. These cities are seeing demand exceed supply, being major employment centres with large student populations, it said.
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BROKER RATING CHANGES
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Barclays reinitiates Capita with 'overweight' - price target 40 pence
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JPMorgan cuts Assura to 'neutral' (overweight) - price target 62 (71) pence
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JPMorgan raises Workspace to 'overweight' (neutral) - price target 650 pence
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COMPANIES - FTSE 100
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Anglo-Swiss commodity trading and mining company Glencore has scrapped plans for a huge coal mine in the Australian state of Queensland. Mining at the Valeria open pit mine, which would have produced up to 20 million tonnes of thermal and metallurgical coal annually for 37 years, was due to begin in 2024. Glencore cited global uncertainties for the decision to abandon the project as well as the Queensland government's decision to increase royalties on coal.
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Associated British Foods, owner of the Primark discount fashion store chain, reiterated its annual outlook. AB Foods still expects significant sales growth, but adjusted operating profit and adjusted earnings per share to be lower than the previous financial year. Chair Michael McLintock to the company's annual general meeting he expects "further significant" input cost inflation, but said the volatility of input costs has "diminished". AB Foods expects the aggregate profit of its Food businesses to be higher than last financial year. Primark trading has been encouraging, he noted, and ABF is on track to open 27 new Primark stores in the year - 10 of these in the run-up to Christmas, with 6 already opened.
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Anglo American said it was moderating its near-term production growth plans, as it focuses on "stable platform from which to build strengthened and repeatable performance". It expects production in 2022 to be down 3% on 2021, as copper ramp-up at Quellaveco and strong diamond production is offset by ore grades in Chile and lower production from Kumba and platinum group metals. In 2023, production is expected to be up 5% as Quellaveco ramps up. In 2024, production is forecast to increase 5%, driven by copper, iron ore and steelmaking coal, and in 2025, production is expected to be in line with 2024.
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COMPANIES - FTSE 250
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International Public Partnerships has agreed to acquire five infrastructure investments in New Zealand for NZD200 million, around USD128 million, to enhance its Australasian presence. These include three schools projects, the Auckland prison, and student accommodation in Auckland. "These high-quality infrastructure investments are already operational, delivering long-term stable cash flows linked to inflation," IPP said.
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OTHER COMPANIES
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ProCook Group said sales in recent weeks have been weaker than anticipated, as consumer demand softens due to the cost-of-living crisis in the UK. The kitchenware retailer now expects revenue for its full year to be between GBP60 million to GBP65 million. It expects annual underlying profit before tax to be approximately breakeven. This is due to "the combination of the continued softer year-on-year sales performance and heightened costs due to shipping and foreign exchange impacts, additional marketing and promotional activity, and investing in our operational teams to serve higher volumes", ProCook explained. It expects gross margins to recover in the next financial year, aided by lower shipping costs in new product intake and company plans to cut operating costs by GBP3 million on an annualised basis.
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By Elizabeth Winter, senior markets reporter
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