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(Alliance News) - Stock prices in London are seen opening in the red on Friday tracking Asian equity markets lower, as investors look ahead to key US inflation data in the afternoon.
In early company news, Anglo American forecast an upbeat performance in 2022 and Hilton Food Group launched a share placing to part fund an acquisition.
IG futures indicate the FTSE 100 index is to open 28.86 points lower at 7,292.40. The blue-chip index ended down 15.79 points, or 0.2%, at 7,321.26 Thursday.
Anglo American confirmed 2021 guidance and promised 35% growth over next decade at an "attractive 50% margin".
The miner expects 2021 production to be up 7% from 2020, on strong platinum-group metals performance and higher rough diamond demand.
For 2022, Anglo expects capital expenditure in a range between USD6.2 billion to USD6.7 billion. Anglo also raised its performance improvement target to USD3.5 billion to USD4.5 billion by 2023.
Finance Director Stephen Pearce commented: "Our balanced approach is supporting sequenced investment in value accretive growth and considerable long term business improvement, alongside attractive shareholder returns. We have delivered USD10.3 billion in cash returns to our shareholders since 2017 and USD4 billion in the second half 2021 alone. Our ongoing investment in the business also supports our emissions reduction objectives and we therefore expect our normal cycle of capital investment to continue to fund the majority of our operational decarbonisation projects."
Anglo American also upgraded the scope of its Woodsmith polyhalite fertiliser project in Yorkshire, while also moving Tom McCulley to take over from Chris Fraser as CEO of Crop Nutrients. McCulley had been leading Anglo's Quellaveco copper project in Peru.
Hilton Food said it has agreed to buy Dutch Seafood Co, the owner of smoked salmon producer Foppen, at enterprise value of EUR90.0 million. The company said the move expands its presence in a growing protein category, as well as entering the US, a new geography for Hilton.
Hilton Food launched an equity placing to raise gross proceeds of around GBP75 million to part fund the acquisition, with the remainder coming from a bridge debt facility. Hilton said the share placing is to be conducted by Numis as sole bookrunner.
The call for a lower open in London on Friday follows downbeat trading in Asia.
The Japanese Nikkei 225 index closed 1.0% lower. In China, the Shanghai Composite closed down 0.2%, while the Hang Seng index in Hong Kong was down 1.0%. The S&P/ASX 200 in Sydney finished down 0.4%.
With the government set to release data that could show prices rising even faster in the US, President Joe Biden on Thursday attempted to downplay the report as not reflective of the latest economic trends.
The Labor Department will on Friday release its November reading on consumer prices, which analysts believe will indicate they accelerated compared to the same month in 2020, likely giving Biden's Republican opposition another counterattack to his economic agenda.
In an unusual statement released ahead of the data, Biden said the report will not encompass declines in prices of energy and used cars, two drivers of the high inflation readings in recent weeks.
"The information being released tomorrow on energy in November does not reflect today's reality, and it does not reflect the expected price decreases in the weeks and months ahead, such as in the auto market," Biden said.
Consumer prices in October rose 6.2% compared to the same month last year, their sharpest annual increase since November 1990, which surprised analysts and spurred Biden to make fighting inflation a top priority for his administration.
CMC Markets analyst Michael Hewson commented: "Yesterday saw a cautious session for markets in Europe, with investors becoming ever more reticent heading into the weekend, particularly since today's US consumer price index report for November could well see headline inflation rise to its highest levels since the 1980's when Ronald Reagan was president of the US.
"The risk of tighter restrictions due to Omicron is also tempering risk appetite, after the early gains of earlier in the week, with US markets also closing lower...As we look ahead to this afternoon's US numbers, European markets are set to open slightly lower, as Asia markets also underwent a similarly cautious session."
The pound was quoted at USD1.3214 early Friday, up from USD1.3191 at the London equities close Thursday.
In economic news, the UK economy posted sluggish growth in October as the country continues to recover from the coronavirus pandemic, according to the Office for National Statistics.
UK gross domestic product advanced 0.1% in October from September, slowing from month-on-month growth of 0.6% in September. The October print missed the market estimate, cited by FXStreet, of 0.4%. The ONS said the UK economy remains 0.5% below its pre-coronavirus pandemic level.
The euro was priced at USD1.1289, lower from USD1.1332. Against the Japanese yen, the dollar was trading at JPY113.65, up from JPY113.52.
Brent oil was quoted at USD74.04 a barrel Friday morning, down sharply from USD75.22 on Thursday evening. Gold stood at USD1,771.45 an ounce, lower against USD1,777.03.
Friday's economic calendar has the US consumer price index print at 1330 GMT.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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