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(Alliance News) - Europe's blue chip benchmarks were searching for direction at the open on Thursday as investors gear up for the latest European Central Bank rate decision.
The decision from the ECB is at 1245 BST, before Lagarde's press conference at 1330 BST.
Oanda senior market analyst Jeffrey Halley said: "The ECB's position is complicated by being on the frontlines of the economic war on Russia. As such, I expect them to leave policy rates unchanged but reiterate the scheduled reduction of the asset purchase programme.
"It will all be about the statement and the press conference and whether the ECB signals that supporting the economy through the Ukraine conflict takes priority over rising inflation pressures, or whether the stage is being set for rate hikes later this year. The former should see EUR-USD hold at present levels; the latter could set of a decent euro short-squeeze into the weekend."
The FTSE 100 index was down 15.98 points, or 0.2%, at 7,564.82 early Thursday. The mid-cap FTSE 250 index was down 38.40 points, or 0.2%, at 20,946.05, while the AIM All-Share index was just 0.19 of a point at 1,057.00.
The Cboe UK 100 index was down 0.2% at 752.67. The Cboe 250 was down 0.2% at 18,410.22, and the Cboe Small Companies down 0.1% at 15,409.72.
In mainland Europe, the CAC 40 in Paris was slightly higher, while the DAX 40 in Frankfurt was up 0.1%.
The pound was quoted at USD1.3133 early Thursday, up from USD1.3060 at the London equities close on Wednesday. The euro was priced at USD1.0906, higher from USD1.0863.
In London, budget airline Wizz Air was atop the midcaps, rising 5.8%. The airline expects a widened annual loss but saw a better than expected fourth quarter performance and is preparing for strong demand over the upcoming summer season.
In the final three months of the company's financial year, ended March 31, it expects to report a net loss between EUR190 million and EUR210 million - which would beat previous expectations, thanks to a "stronger trading environment".
To begin financial 2023, Wizz said it is ramping up operations for a "busy" summer programme with available seat kilometres 30% ahead of the April to June 2019 quarter and more than 40% ahead of the July to September 2019 quarter.
"We have been encouraged by demand trends in recent weeks and given the shorter booking horizon expect the bookings for this summer to build significantly after Easter," the airline added.
In a positive read-across, British Airways-parent International Consolidated Airlines advanced 2.1% and easyJet gained 1.2%. Hotel operator InterContinental Hotels Group was up 2.0%.
discoverIE Group was also enjoying a strong start to the session after it raised expectations following a "strong" trading performance in the firm's final two months of its financial year, which ended March 31.
The FTSE 250-listed maker of customised electronics, for sectors such as renewables and transport, was up 2.6%.
It said orders remain "well ahead" of sales, rising organically by 13% year on year and up 27% on the period two years ago. Group sales in the final 2 months are up 20% on the year prior and 22% higher on the same period two years ago.
As a result, group orders for the annual period are up 36% year on year, as sales rise 25%.
discoverIE ended its financial year with an order book of GBP224 million, a record for the company.
Dunelm's third quarter sales shot up, it said, thanks to the reopening of its stores, leading the firm to confirm its confidence in meeting market expectations for its annual profit.
In the 13 weeks to March 26, total sales rose 69% year on year to GBP399 million, with year-to-date sales up 25% to GBP1.20 billion.
It noted in the third quarter last year its store estate was closed to customers and only Click & Collect and home delivery services were available.
The homeware retailer said: "Customers responded well to our Winter Sale held in the first few weeks of the quarter, with a very strong sales performance across most categories. We have continued to refresh our product ranges, with our new 'Summer Living' products performing particularly well during March, as customers looked to ready their homes and gardens for summer."
For financial 2022, Dunelm notes the latest range of analyst forecasts puts its pretax profit between GBP195 million to GBP215 million, with consensus at GBP207 million. In financial 2021, it posted a pretax profit of GBP157.8 million.
Dunelm was 2.2% higher in early trading in London on Thursday.
At the other end of the FTSE 250, Hays shed 2.8%. The recruiter hailed a record performance at the start of 2022 amid a shortage of skills worldwide, but revealed a hit of around GBP5 million after pulling out of Russia.
The group posted a 32% surge in like-for-like fees over its third quarter to the end of March, with record-breaking results across 19 countries and its highest-ever monthly fees in March.
Fees in the UK and Ireland rose 29%, it added.
Hays said the closure early last month of its offices in Russia due to the invasion of Ukraine will result in about GBP5 million in one-off costs. Full-year guidance remains for full-year operating profit of GBP210 million to GBP215 million, excluding the Russia hit.
In Asia on Thursday, the Japanese Nikkei 225 index closed up 1.2%. In China, the Shanghai Composite closed 1.2% higher, while the Hang Seng index in Hong Kong was up 0.5% in late trading. The S&P/ASX 200 in Sydney ended up 0.6%.
Against the yen, the dollar was trading at JPY125.20 early Thursday, down from JPY125.69.
Brent was quoted at USD107.40 a barrel on Thursday morning, up versus USD106.79 at the time of the equity market close in London on Wednesday.
Gold stood at USD1,974.80 an ounce, lower against USD1,977.64 late Wednesday.
As well as the ECB's interest rate decision, Thursday's economic calendar has the latest US initial unemployment claims at 1330 BST.
On the corporate side, earnings are due from US banks Citi, Goldman Sachs, Morgan Stanley and Wells Fargo before the New York market open on Thursday.
By Paul McGowan; paulmcgowan@alliancenews.com
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