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(Alliance News) - Stocks in London are set to open marginally lower on Friday as a lacklustre week for the FTSE 100 draws to a close, with focus on a raft of PMIs for January.
In early company news, Computacenter raised profit guidance and Kainos said it now expects results for its current financial year ahead of market forecasts.
IG says futures indicate the FTSE 100 index of large-caps to open 5.82 points, or 0.1%, down at 6,709.60 on Friday. The FTSE 100 closed down 24.97 points, or 0.4%, at 6,715.42 on Thursday - at this level down 0.3% since the week began.
"Markets here in Europe have had a more subdued week, with little in the way of progress after the falls seen at the end of last week," said Michael Hewson, chief market analyst at CMC Markets.
"The gains in the US last night don't appear to have filtered through to markets in Asia, and don't appear to be generating any lift here in Europe either, with a slightly negative bias expected to the open this morning, as concerns about extended lockdowns weigh on optimism."
Hewson added: "Today's economic data from the UK, as well as France and Germany are set to showcase further the additional damage being done to their respective economies over the Christmas and New Year period."
The economic events calendar on Friday has PMI readings from Germany, eurozone and the UK at 0855 GMT, 0900 GMT and 0930 GMT respectively.
Consensus, according to FXStreet, sees the UK manufacturing PMI falling to 54.0 points in January from 57.5 in December. The services PMI is expected to slide to 45.0 from 49.4 the month before.
The eurozone's manufacturing PMI is seen at 54.6 points for January, below December's 55.2, while the services sector is in for a sharper slump to 45.0 from 46.4.
The pound and euro were mixed against the dollar ahead of the data.
Sterling was quoted at USD1.3671 early Friday, lower than USD1.3732 at the London equities close on Thursday. The euro traded at USD1.2156, firm on USD1.2151 late Thursday.
Ahead of the PMI data, the Office for National Statistics said UK retail sales increased 0.3% month-on-month in December - rebounding from a 4.1% slide in November - which resulted in an increase of 2.7% when compared with February's pre-pandemic level.
Year-on-year, retail sales grew 2.9%, with non-store retailers - which includes online shops and market stalls - racked up 44% growth and food stores saw a 4.4% increase. This accelerated from growth of 2.1% in November.
"The sharp deterioration in near-real time data lead us to conclude that retail sales volumes will fall by about 5% month-to-month in January," Pantheon Macroeconomics noted.
In 2020 as a whole, UK retail sales fell an estimate 1.9% when compared with 2019, the largest year-on-year fall on record, the ONS said.
Japan's private sector downturn continued at the start of the new year, according to early figures from au Jibun Bank.
Flash estimates showed Japan's composite output index dipped to 46.7 points in January, below the 50.0 neutral mark and the 48.5 final figure from December. The flash manufacturing output index fell to 49.7 in January, from December's final 50.0 reading, while the services index fell deeper into contraction territory to 45.7 from 47.7.
Against the yen, the dollar rose to JPY103.67 early Friday in London from JPY103.53 at the London equities close on Thursday.
The Japanese Nikkei 225 index closed down 0.4%. In China on Friday, the Shanghai Composite closed down 0.4%, while the Hang Seng index in Hong Kong is down 1.6%. ÂÂ
The S&P/ASX 200 in Sydney closed down 0.3%.
In early UK company news, Computacenter said it now expects adjusted pretax profit for 2020 will be in excess of GBP195 million.
This follows continued positive trading for the computer services provider through to the end of the year. Back in December, Computacenter said profit was "unlikely to be less than" GBP190 million, already a jump from 2019's GBP146.3 million.
Computacenter on Thursday said revenue grew by 8% in 2020, seeing strong growth in Technology Sourcing product sales into the public sector and services-based customers.
"The positive momentum we have seen in trading since the start of the pandemic shows no sign of abating, and our pipelines for both Technology Sourcing and Services are as strong as at any time we have seen in the last year," said Computacenter.
Kainos said it expects results for its current financial year to be ahead of market expectations.
The information technology consulting and software provider noted that continued momentum has driven a strong trading performance thus far in its financial year ending March 31. Kainos added that it is well-positioned for further growth and remains confident in its strategy.
"Looking ahead, our robust pipeline, strong balance sheet and significant contracted backlog underpins our confidence in our outlook," the company said.
London and Johannesburg-listed financial services firm Ninety One in a brief update said assets under management stood at GBP128.6 billion on December 31, up 8.1% from GBP119.0 billion at the end of September.
Mediclinic, which is also listed in both London and South Africa, reported third-quarter revenue growth though remained cautious on outlook.
The private hospital operator said third-quarter revenue was up 2.5%, supported by "unseasonably high inpatient activity" in December at Mediclinic Southern Africa and Mediclinic Middle East. This was partially offset by the lower patient volumes at Hirslanden, Switzerland.
"The uncertainty caused by the pandemic has reduced visibility on activity levels and therefore the group remains cautious as to the full impact on near-term operating performance," Mediclinic said.
In the US on Thursday, Wall Street ended mixed, with the Dow Jones Industrial Average ending down 0.1%, the S&P 500 slightly higher, and the Nasdaq Composite up 0.6%.
The US flash manufacturing and services PMIs are due at 1445 GMT.
Gold was quoted at USD1,860.02 an ounce early Friday, lower than USD1,864.60 late Thursday in London. Brent oil was trading at USD55.48 a barrel, down from USD56.05 late Thursday.
By Lucy Heming; lucyheming@alliancenews.com
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