(Alliance News) – Shares in London are set to open slightly higher on Friday, ahead of results from major US banks, as sentiment was boosted by colder-than-expected inflation in the US.
IG says futures indicate the FTSE 100 large-cap index is set to open up 16.5 points, or 0.2%, at 7,859.88 on Friday. The FTSE 100 index closed up 18.54 points, or 0.2%, at 7,843.38 on Thursday.
“European markets saw another positive session yesterday, driven by the outperformance of the luxury sector, with the CAC 40 closing at new highs, while the DAX and FTSE100 also posted some modest gains,” said Michael Hewson. from CMC Markets.
The CAC closed up 1.1% at 7,480.83, with LVMH adding 5.7%.
In the United States, Wall Street rallied on Thursday, with the Dow Jones Industrial Average ending up 1.1%, the S&P 500 up 1.3% and the Nasdaq Composite up 2.0%.
Sentiment was supported by colder than expected headline inflation.
According to the Labor Department, producer price inflation declined to 2.7% year-on-year in March from 4.9% in February, below the consensus of 3.4% cited by FXStreet. The February figure has been revised upwards from 4.5%.
This has led some to hope that the Federal Reserve may be nearing the end of its rate hike cycle, with potential rate cuts on the horizon later in the year.
“However, with the US labor market holding up reasonably well, it’s hard to imagine the Federal Reserve being pressured to cut rates as long as the US economy continues to hold up reasonably well on the jobs front,” noted CMC’s Mr. Hewson.
The dollar saw a mixed picture against the major currencies, with the pound rising above $1.25 and the euro materializing its gains above $1.10.
The pound was listed at $1.2540 early Friday, higher than $1.2519 at the close of London stock markets on Thursday. The euro was trading at $1.1070 early Friday, higher than $1.1053 late Thursday. Against the yen, the dollar was quoted at 132.55 yen, up from 132.41 yen.
Later today, Wells Fargo, JPMorgan and Citigroup will release their quarterly results, along with asset manager BlackRock.
The results will show “how U.S. business and consumer lending held up in a turbulent quarter for the sector,” Hewson noted.
In Asia on Friday, the Nikkei 225 index was up 1.2%. In China, the Shanghai Composite Index was up 0.4%, while the Hang Seng Index in Hong Kong was up 0.2%. The S&P/ASX 200 index in Sydney was up 0.5%.
In the UK, pollster YouGov is set to appoint a former Meta Platforms executive as chief executive, Sky News reported on Thursday.
Steve Hatch, who led Meta’s operations in Northern Europe, will be announced as the new CEO of YouGov on Friday morning, Sky reported.
Gold was quoted at $2,041.79 an ounce early Friday, little change from Thursday’s $2,040.03. Brent oil was trading at $86.38 a barrel, down from $87.01.
In Friday’s UK business calendar, bookmaker 888 Holdings and sausage casing maker Devro will release their annual results, while AO World, Hays and CMC Markets will release their trading statements.
In the economic calendar, there is the German Wholesale Price Index at 0700 BST, US Retail Sales at 1330 BST, and US Industrial Production at 1500 BST.
By Elizabeth Winter, Senior Markets Reporter at Alliance News
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