LONDON (Alliance News) - UK stocks are set to open broadly flat Tuesday ahead of that latest UK inflation data due for release at 0830 GMT.
Stocks had a mixed session across Europe on Monday, with the FTSE 100 underperforming its major European peers largely due to the more than 10% fall suffered by AstraZeneca on the back of its rejection of a final takeover offer from US drugmaker Pfizer.
US stocks managed to close modestly higher, however, with the DJIA up 0.1% and the S&P 500 up 0.4%. Asian markets also have broadly gained early Tuesday, despite the unexpected imposition of martial law in Thailand overnight, with the Japanese Nikkei up 0.8%, and the Hang Seng up 0.6%, although the Shanghai Composite closed fractionally lower.
"The imposition of martial law in Thailand has certainly become the major event overnight, with many voicing anxiety over a potential coup," says Joshua Mahony, a research analyst at Alpari. Although, "previous experience shows us that such issues do not typically translate into significant losses, with the sell-off in response to the ousting of Yingluck?s brother back in 2006 being remarkably uneventful," the analyst adds.
After closing 0.2% lower on Monday at 6,844.55, spread betters are calling the FTSE 100 to open broadly unchanged Tuesday.
The UK economy provides the morning focus, with the latest inflation data from the Office for National Statistics due for release at 0830 GMT.
Economists expect annual UK consumer price inflation to edge closer to the Bank of England's official 2.0% target, with a reading of 1.7% in April after having dipped to a low since October 2009 in March of 1.6%. On a monthly basis, prices growth is also expected to speed up slightly to 0.3% in April from 0.2% previously.
However, with factory gate price inflation still relatively contained and given the elevated level of sterling, "the inflation outlook is expected to remain relatively subdued over the coming year," said Lloyds Bank UK macroeconomist Nikesh Sawjani.
The German producer price index has already been released Tuesday and has disappointingly remained negative. On a monthly basis producer prices declined by 0.1% in April after shrinking by 0.3% in March. Economists had expected prices to remain stable. On a yearly basis, prices fell by 0.9% in April, after also falling at that rate in March.
Otherwise the data calendar remains fairly quiet. there are a number of central bank speakers later in the afternoon, including US Philadelphia Fed president Charles Plosser at 1630 GMT, New York Fed President William Dudley at 1700 GMT, and UK Monetary Policy Committee member Charlie Bean at 1730 GMT.
Bean's words may give some early indication of what's to come when the minutes of the latest MPC meeting are released on Wednesday.
In the UK corporate calendar Tuesday, Vodafone Group has released full-year results, as have Marks & Spencer Group, BTG, Homeserve, and Big Yellow Group.
By Jon Darby; jondarby@alliancenews.com; @jondarby100
Copyright 2014 Alliance News Limited. All Rights Reserved.
Marks & Spencer (MKS)
Vodafone (VOD)
Big Yellow (BYG)