LONDON MARKET COMMENT: Stocks Set To Rebound From Tuesday's Losses

Wed, 06th May 2015 05:58

LONDON (Alliance News) - UK stocks are set to open higher Wednesday, on the eve of the UK General Election, rebounding from Tuesday's losses, as China's service sector expanded at a faster rate in April than in March.

IG says futures point the FTSE 100 to open 15.3 points higher at 6,942.9. The index ended down 0.8% at 6,927.58 on Tuesday amid a wider European equity sell-off, as oil prices rose to their highest levels of the year due to fears of supply disruptions in Libya. Ahead of the London open Brent oil has held onto the gains and trades at USD68.23 a barrel, while West Texas Intermediate trades at USD61.36 a barrel.

On Wall Street Tuesday, the DJIA ended down 0.8%, the S&P 500 closed down 1.2%, and the Nasdaq Composite ended off 1.6%.

In Asia Wednesday, the Japanese Nikkei remains closed for holiday. The Hang Seng trades up 0.6% and the Shanghai Composite is up 1.3%.

The services sector in China expanded at an accelerated pace in April, the latest survey from HSBC showed, with a Purchasing Managers' Index score of 52.9. That's up from 52.3 in March, and it moves further above the boom-or-bust score of 50 that separates expansion from contraction. However, the reading was a touch light of consensus estimates for a rise to 53.1.

In a full UK corporate calendar, J Sainsbury reports full-year results, and Imperial Tobacco Group reports half-year results, as does software and services company Sage Group. Irish building materials company CRH issues an interim management statement, along with Carillion, Direct Line Group, Legal & General Group, JD Wetherspoon, National Express Group and GKN. Supergroup reports fourth-quarter results, and International Consolidated Airlines Group issues April traffic statistics. Prudential releases an interim management statement at 0915 BST, and GlaxoSmithKline reports first quarter results at 1200 BST.

In the economic calendar, there is Markit services and composite PMI from France at 0850 BST, Germany at 0855 BST, and the eurozone at 0900 BST. The UK Markit services PMI is at 0930 BST. Eurozone retail sales is at 1000 BST, before US ADP employment change at 1315 BST and EIA crude oil stocks at 1530 BST.

By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1