Last checked at 
(Alliance News) - Stocks in London are set to open higher on Thursday, after the US Federal Reserve, as expected, stepped back its pace of interest rate hikes to 25 basis points.
Next up are the Bank of England and European Central Bank. The BoE will unveil its interest rate decision at 1200 GMT on Thursday, followed by the ECB at 1300 GMT, with markets expecting a 50 basis point hike from both.
The Federal Open Market Committee lifted the target range for the federal funds rate to 4.50% to 4.75% from a previous range of 4.25% to 4.50%. All twelve members of the committee voted for the rise.
In a press conference following the decision, Fed Chair Jerome Powell said the central bank will need "substantially more evidence" to be confident that inflation is on a sustained downward path in the US, despite "encouraging" recent developments.
"For all of Fed chair Jay Powell's insistence that more rate hikes were coming, and that the Fed was not looking at cutting rates this year, his failure to push back emphatically on direct questions about market expectations of rate cuts this year, as well as the loosening of financial conditions has created an even greater divergence between market pricing on rates, and the Fed's expectations of how the economy is likely to evolve," commented Michael Hewson, chief market analyst at CMC Markets UK.
He added: "The market thinks the inflation job is done, even if the Fed hasn't arrived at that conclusion yet. Consequently, this goes a long way to explaining why US markets closed strongly higher and yields and the US dollar plunged to 9-month lows, with the euro hitting USD1.1000 for the first time since April last year."
In UK corporate news on Thursday, FTSE 100 heavyweight Shell announced a multi-billion-dollar share buyback as it posted an increase in both revenue and profit in 2022.
Telecommunications operator BT reported a drop in 9-month revenue and profit, following the removal of BT Sports revenue to a new joint venture.
Here is what you need to know at the London market open:
----------
MARKETS
----------
FTSE 100: called up 0.4% at 7,795.0
----------
Hang Seng: flat at 22,081.91
Nikkei 225: closed up 0.2% at 27,402.05
S&P/ASX 200: closed up 0.1% at 7,511.60
----------
DJIA: closed up 6.92 points at 34,092.96
S&P 500: closed up 42.61 points, or 1.1%, at 4,119.21
Nasdaq Composite: closed up 231.77 points, or 2.0%, at 11,816.32
----------
EUR: up at USD1.1005 (USD1.0919)
GBP: up at USD1.2383 (USD1.2315)
USD: down at JPY128.69 (JPY129.28)
Gold: up at USD1,951.72 per ounce (USD1,928.82)
(Brent): down at USD83.17 a barrel (USD84.42)
(changes since previous London equities close)
----------
ECONOMICS
----------
Thursday's key economic events still to come:
14:15 CET ECB interest rate announcement
08:00 CET Germany foreign trade
12:00 GMT UK interest rate decision
12:00 GMT UK BOE monetary policy report
12:00 GMT UK BOE meeting minutes
08:30 EST US unemployment insurance weekly claims report
16:30 EST US federal discount window borrowings
16:30 EST US Foreign Central Bank holdings
----------
Rail passengers have been warned to expect continued disruption to their journeys in the aftermath of Wednesday's strike action and ahead of Friday's walkouts. Commuters have been warned by operators to expect "significantly reduced train services" across all three days and advised to check ahead of taking a journey. Train driver members of Aslef and the Rail, Maritime & Transport union staged industrial action on Wednesday and will take to picket lines again on Friday in a long-running dispute over pay, jobs and conditions. Network Rail said: "Due to industrial action, there will be significantly reduced train services from Wednesday 1 until Friday February 3.
----------
BROKER RATING CHANGES
----------
Goldman Sachs cuts Standard Chartered to 'neutral' (buy) - price target 885 (845) pence
----------
JPMorgan cuts Vodafone price target to 95 (97) pence - 'neutral'
----------
Jefferies cuts NCC Group price target to 245 (260) pence - 'buy'
----------
COMPANIES - FTSE 100
----------
Oil major Shell announced a USD4 billion share buyback, as it reported that revenue in the fourth quarter of 2022 rose to USD101.30 billion from USD85.28 billion a year earlier. Pretax profit increased to USD16.44 billion in the quarter up from USD16.27 billion. Full-year revenue climbed to USD386.20 billion, up from EUR272.66 billion year-on-year, whilst pretax profit more than doubled to USD64.81 billion from USD29.83 billion. The company declared a dividend of USD0.29 for its fourth quarter, up from USD0.24 a year earlier; this brings the full-year dividend to USD1.04 up from USD0.89. Shell said the share buyback will be completed by the time of its first quarter results announcement.
----------
Telecommunications firm BT reported revenue of GBP15.59 billion in the nine months to December 31, down 1% from GBP15.68 billion a year ago. Pretax profit fell by 15% to GBP1.31 billion from GBP1.54 billion. BT explained that revenue was helped by price increases and improved trading seen in its Openreach and Consumer divisions. However, this was offset by disposals and the removal of BT Sports revenue due to its new joint venture. Adjusting for that, revenue was up by GBP65 million, it said. Looking ahead, BT confirmed its financial outlook; normalised free cash flow will be heavily weighted to the fourth quarter.
----------
COMPANIES - FTSE 250
----------
NCC Group said revenue in the six months to November 30 increased to GBP176.6 million from GBP150.1 million a year ago. Pretax profit jumped to GBP10.3 million from GBP8.4 million. The cybersecurity firm declared an interim dividend of 1.50 pence, unchanged year-on-year. However, NCC said that since the beginning on the second half of its financial year it has experienced a lengthening of the sales cycle, which is leading to delays in buying decisions, work commencement and therefore revenue recognition, particularly in North America and the UK. Based on this, the company now expects only a single-digit revenue increase on a constant currency basis for all of financial 2023.
----------
Budget airline Wizz Air said it carried 4.1 million passengers in January 2023, up 73% year-on-year, at a load factor of 86%. January's capacity increased by 60% to 4.8 million seats from GBP3.0 million seats. On a rolling 12-months basis capacity climbed 76% to 54.5 million seats from GBP31.0 million seats at January 31, 2022. Passengers more the doubled to 47.4 million from 23.5 million.
----------
OTHER COMPANIES
----------
Ryanair said customer numbers grew by 69% to 11.8 million in January from 7.0 million a year before, as load factor improved to 91% from 79%.
----------
Flooring manufacturer James Halstead said revenue in the six months to December 31 is expected to be around 8% to 9% ahead of the comparative period in the prior year. Over the six-month period, trading of UK manufactured goods has been hurt by the lack of availability of international shipping to several overseas territories most notably Australia, North and South America, it noted. However, in December, James Halstead said it saw saw signs of reduced international freight costs and raw material costs, but energy costs remain at historically high levels. Based on this pretax profit for the first half of the year will be short of the comparative period, but the company said full-year expectations are unchanged.
----------
By Sophie Rose, Alliance News reporter
Comments and questions to newsroom@alliancenews.com
Copyright 2023 Alliance News Ltd. All Rights Reserved.
