GCILondon pre-open: Stocks seen up as Archegos fallout brushed off
(Sharecast News) - London stocks were set to rise at the open on Tuesday as investors brush off the fallout from the Archegos fire sale.
The FTSE 100 was called to open 30 points higher at 6,766.
CMC Markets analyst Michael Hewson said: "If markets were worried about the spill over effects from Friday's $20bn block trade margin call, and the potential spill overs from the Ever Given container ship getting stuck in the Suez Canal, then yesterday's price action suggested the fallout was fairly contained.
"European markets finished yesterday's session broadly higher, while US markets finished the day well off the lows of the day, despite opening the week sharply lower, though the Russell 2000 did rather get taken to the cleaners, finishing the day over 2.8% down.
"For the banks involved the losses will be painful, and probably a little embarrassing, however they aren't likely to undermine confidence in the stability of the financial system.
"In light of yesterday's recovery off the lows today's European market session looks set to be a positive one."
In corporate news, Royal Mail said it would pay a one off dividend and held full-year profits guidance as it outlined plans to more than double profits at its GLS parcels unit in the next five years.
The letter and parcels delivery company will pay shareholders 10p a share in response to a surge in parcels deliveries from online shopping during the Covid pandemic. It added that annual group adjusted operating profit is still expected to be around £700m.
GLS said adjusted operating profit is expected to be around £350m and adjusted operating profit margin 8.7%.
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