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(Alliance News) - Stock prices in London are set for a lower open on Wednesday morning after UK inflation picked up pace in June.
IG says futures indicate the FTSE 100 index of large-caps to open down 12.72 points, or 0.2%, at 7,112.00 on Wednesday. The FTSE 100 closed down 0.70 of a point, or 0.1%, at 7,124.72 on Tuesday.
The Office for National Statistics said the UK consumer price index jumped 2.5% on an annual basis in June, accelerating from 2.1% growth in May. The largest upward contribution to the 12-month inflation rate came from transport.
Month-on-month, UK consumer prices rose 0.5% in June, slower than May's 0.6% rate of monthly growth.
Prices for food, second-hand cars, clothing and footwear, eating and drinking out, and motor fuel rose between May and June after falling between the same two months a year ago.
"June's consumer prices figures show that businesses sought to take advantage of strong consumer demand following the relaxation of Covid-19 restrictions," said Pantheon Macroeconomics Chief UK Economist Samuel Tombs.
A separate release from the ONS on Wednesday showed UK producer price inflation also strengthened in May.
Output prices grew 4.3% in the year to June, slowing from growth of 4.4% in May, while input prices jumped 9.1% on a 12-month basis, again easing from May when prices grew 10%.
Sterling was quoted at USD1.3825 early Wednesday, lower than USD1.3838 at the London equities close on Tuesday.
The euro traded at USD1.1788 early Wednesday, lower against USD1.1815 late Tuesday. Against the yen, the dollar was up to JPY110.52 from JPY110.33.
In early UK company news, housebuilder Barratt Developments reported strong demand across the country in the financial year that ended June 30. Net private reservations per active outlet per week were 0.78, up from 0.60 in financial 2020 and 0.70 in financial 2019.
Completion volumes also ticked up, with 17,243 total homes completed in the recent financial year versus 12,604 homes in financial 2020 and 17,856 homes in financial 2019.
Barratt said it expects pretax profit, after adjusted items of GBP107 million, to be at the top end of the range of market forecasts.
Looking ahead, the company said it is well positioned for its new financial year, with total forward sales - including joint ventures - as at June 30 of 14,334 homes, up from 14,326 homes the year before and up from 11,419 homes year-on-two-years.
Drugmaker AstraZeneca said the UK Competition & Markets Authority has cleared its proposed acquisition of Alexion Pharmaceuticals. As a result, the acquisition is expected to close on July 21.
The move follows clearance received from the European Commission on Tuesday last week, and approvals in the US, Japan and other countries.
AstraZeneca is buying Boston, Massachusetts-based biotech firm Alexion in a cash-and-stock deal that was worth around USD39 billion when the acquisition was first announced back in December. The deal would "enhance the company's scientific presence in immunology", Astra said.
After the acquisition is complete, a new group focusing on rare diseases will be created named Alexion, AstraZeneca Rare Disease, and will be headquartered in Boston.
Homewares retailer Dunelm Group said total sales in the 13-week period ended June 26 more than doubled compared to the same period last year, when stores were closed during the first national lockdown. On a two year basis, total sales in the quarter were up by 44%.
Digital sales growth, meanwhile, also remained strong throughout the quarter, up 38% on the same period last year, Dunelm said.
Looking ahead, Chief Executive Nick Wilkinson said: "With many exciting developments in the pipeline to make us the first choice for home, and grow our customer base and frequency, there is a lot to look forward to."
In addition, Dunelm named Vijay Talwar as a non-executive director from October. Talwar is CEO for Europe, Middle East & Africa at New York-based athletic retailer Foot Locker.
Coats Group - an industrial thread manufacturer - said strong operational performance and demand recovery have continued in the first half of 2021, despite the impact of recent lockdowns in India in May and June, which have now subsided.
Sales for the half-year were USD732 million, up from USD536 million a year ago and up from USD705 million in the first half of 2019.
Coats said it now expects adjusted operating profit for the first half to be around USD95 million, almost tripled from USD34 million a year prior but lower than USD102 million in the first half of 2019.
Clothing retailer boohoo Group has partnered with Alshaya Group, building on the presence of Debenhams in the Middle East region.
Alshaya will have exclusive rights to operate the Debenhams stores and a local e-commerce platform in Kuwait, Saudi Arabia, United Arab Emirates, Bahrain, Egypt, Oman and Qatar.
In Asia on Wednesday, the Japanese Nikkei 225 index closed down 0.4%. In China, the Shanghai Composite was down 0.9% and the Hang Seng index in Hong Kong fell by 0.6%.
Brent oil was trading at USD76.42 a barrel early Wednesday, rising from USD75.50 late Tuesday. Gold was quoted at USD1,812.50 an ounce early Wednesday, up from USD1,811.70 on Tuesday.
The economic events calendar on Wednesday has eurozone industrial production numbers at 1000 BST and US producer prices at 1330 BST.
Financial markets will be closed in France on Wednesday for the Bastille Day holiday.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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