London pre-open: Stocks to nudge down on weak Asian cues
London stocks looked set to nudge lower at the open on Monday following a downbeat Asian session, as investors continue to fret over US bond yields.
The FTSE 100 was called to open three points lower at 7,315.
London Capital Group analyst Jasper Lawler said: "Asian markets have taken the lead from the US and traded predominantly lower. European bourses are looking to follow suit extending Friday’s steep losses.
"On the FTSE heavily, weighted commodity stocks will be in focus, as metals across the board and oil sold off overnight. Growing concerns over the health of the Chinese economy were highlighted in a private Caixin service sector report. Non-manufacturing grew at its fastest pace in three months, the PMI hitting 53.5 from 51.5 in August. However, sentiment worsened, and firms started cutting jobs as higher costs squeezed profits. The sharp decline in employment shows dark clouds are forming on the horizon of the Chinese economy. This is hitting demand expectations for metals, which fell sharply lower."
In corporate news, responding to press reports, Schroders said it is in discussions with Lloyds Banking Group about working together "in parts of the wealth sector". Last week there was speculation that the fund manager was poised to win the £109bn mandate to manage Lloyds' Scottish Widows investment assets.
UK Commercial Property REIT said it has completed the off-market sale of 15 Great Marlborough Street, an office asset in London's Soho, to Royal London Asset Management for £73.2m.
Elsewhere, Dechra Pharmaceuticals announced the acquisition of Caledonian for NZD8.7m (£4.4m).
Established in 2010, Caledonian supplies a range of proprietary equine drugs to practices in New Zealand and Australia. Dechra said the company's range of drugs will enhance its existing portfolio, which includes Osphos, and will establish Dechra as a leading equine pharmaceutical supplier in both Australia and New Zealand.