London pre-open: Stocks seen flat amid lack of market-moving news
(Sharecast News) - London stocks were called to open more or less flat on Friday after US markets were closed for Thanksgiving, and with little in the way of corporate or economic news to provide any direction.
Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: "Markets were quiet yesterday, as the US was closed for Thanksgiving.
"European markets mostly surfed on the positive reaction from the US equities to the Federal Reserve minutes released a day earlier. The latest minutes from the Fed were heard as dovish, as the Fed is willing to reduce the size of its interest rate hikes.
"But, keep in mind that the fact that they will go higher has been broadly ignored.
"The DAX advanced to a fresh five-month high, and is now preparing to test the major 61.8% retracement on the year-to-date selloff, which stands around 14590 mark, and if cleared, will hint at a stronger recovery in German stocks despite looming recession worries.
"The French CAC40 on the other hand advanced to a fresh 7-month high, and is now up by almost 20% since the dip that we saw end of September.
"And the recent rally in the European stocks is mostly due to the euro's appreciation against the greenback, which also started around end of September, and which somehow eased the inflationary pressures for the European companies, along with the falling energy prices.
"The same is true for sterling and FTSE. A stronger pound feeds into a better appetite for FTSE these days, even though most FTSE companies' revenues are US dollar-denominated. The correlation between Cable and the FTSE has been relatively strong this year."
On the corporate front, energy utility SSE said it was selling a 25% stake in its electricity transmission network business to Ontario Teachers' Pension Plan Board for £1.46bn.
The company said the deal would "unlock significant growth in both the transmission business and across the wider SSE group".
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.