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(Alliance News) - Stocks in London are set to open lower on Wednesday, as investors look ahead to an interest rate decision from the Federal Reserve.
IG says futures indicate the FTSE 100 to open down 16.69 points, or 0.2%, at 7,675.11 on Wednesday. The index of London large-caps closed up 13.21 points, or 0.2%, to 7,691.80 on Tuesday.
A 25 basis point hike by the Federal Reserve on Wednesday is seen as a foregone conclusion, though analysts are divided over whether it will be "one and done" or more rate lifts ahead for the US central bank.
The Federal Open Market Committee kicks off its two-day meeting on Tuesday, with an interest rate decision expected at 1900 BST on Wednesday. A press conference with Chair Jerome Powell will follow shortly after.
According to the CME FedWatch Tool, there is a 99% chance the central bank lifts rates by 25 basis points. It would take the federal funds rate range to 5.25% to 5.50%. The Fed decided against a hike last month, ending a streak of 10 successive rate rises.
In the US on Tuesday, Wall Street ended higher, ahead of the interest rate decision. The Dow Jones Industrial Average up 0.8%, the S&P 500 up 0.3% and the Nasdaq Composite up 0.6%.
Sterling was quoted at USD1.2892 early Wednesday, higher than USD1.2853 at the London equities close on Tuesday. The euro traded at USD1.1055, higher than USD1.1044. Against the yen, the dollar was quoted at JPY141.06, flat versus JPY141.03.
In Asia on Wednesday, the Nikkei 225 index in Tokyo was down 0.1%. In China, the Shanghai Composite was down 0.4%, while the Hang Seng index in Hong Kong was down 0.8%. The S&P/ASX 200 in Sydney closed up 0.8%.
Australian consumer price inflation cooled by more than expected in the second quarter, according to data from the Bureau of Statistics.
In the three months to June, consumer prices rose 6.0% from the prior year, cooling from 7.0% rise in the March quarter. Compared to the previous quarter, prices were 0.8% higher in the second quarter, compared to a 1.4% rise in the first quarter.
The figures were lower than FXStreet-cited market consensus, which had expected an annual reading of 6.2% and a quarterly rise of 1.0%.
Gold was quoted at USD1,964.11 an ounce early Wednesday, slightly higher than USD1,962.17 on Tuesday. Brent oil was trading at USD83.13 a barrel, up from USD82.73.
Wednesday's economic calendar is an otherwise light one with the exception of the Fed decision at 1900 BST.
In contrast, a busy local corporate calendar has half-year results from cigarette maker British American Tobacco, pharmaceutical firm GSK, luxury carmaker Aston Martin Lagonda, lender Lloyds Banking Group and consumer goods company Reckitt Benckiser, among others.
On Tuesday evening, NatWest boss Alison Rose has resigned from her position after admitting to being the source of an inaccurate story about Nigel Farage's finances.
In a statement released early on Wednesday morning, NatWest Group chair Howard Davies said: "The board and Alison Rose have agreed, by mutual consent, that she will step down as CEO of the NatWest Group. It is a sad moment."
Earlier, Rose said she made a "serious error of judgment" when she discussed Farage's relationship with private bank Coutts, owned by NatWest Group, with a BBC journalist.
By Sophie Rose, Alliance News reporter
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