London pre-open: Stocks seen lower after record high; Catalonia in focus
London stocks were set for a weaker open on Friday on what will be a half day trading session ahead of the Christmas break, as investors pause for breath after the FTSE hit an all-time high in the previous session, with eyes on events in Catalonia.
The FTSE 100 was expected to open 18 points lower at 7,585
On Thursday, the top-flight index closed up 1.05% at 7,603.98, which was a record high.
Market participants will be digesting news that Catalonia’s pro-independence parties have held on to their absolute majority in snap regional elections. This is a blow to the Spanish government, which had called the polls in the hope of heading off the secessionist push.
The three separatist parties won a total of 70 seats in the 135-seat regional parliament even though the centre-right, pro-unionist Citizens party was the single biggest winner, with 36 seats.
On UK the data front, the final release of third-quarter UK GDP is at 0930 GMT, along with the index of services.
David Madden at CMC Markets said: “Economists are expecting the reading to remain unchanged at 1.5%. The British economy has been ticking along nicely, and broadly speaking the economic indicators have been positive.
“Mark Carney, the governor of the Bank of England, stated the UK banking system is well financed enough to cope with Brexit, and stated a transitional phase post March 2019 would be beneficial to the British financial sector. The pound has had an impressive 2017, especially when you consider what sharp it was in at the start of the year.”
In corporate news, there was a little M&A action to keep things interesting on what is likely to be a pretty quiet day otherwise, with Ladbrokes Coral agreeing to be taken over by GVC Holdings for a sum of £3.2bn that could rise up to £4bn.
GVC said it sees at least £100m of efficiencies from the deal that should lead to a double-digit boost to earnings.
Elsewhere, BHP Billiton has agreed to provide $181m in financial support to the Renova Foundation and Samarco until the end of June next year, following the dam failure in 2015.