London pre-open: Stocks to nudge up after UK inflation, ahead of Fed announcement
London stocks were set to nudge higher at the open on Wednesday as investors mulled the latest UK inflation figures and looked ahead to a policy announcement from the Federal Reserve.
The FTSE 100 was called to open around five points higher.
Data released earlier by the Office for National Statistics showed that consumer price inflation reached 2.6% in November, the second consecutive rise.
CPI rose in the 12 months to November, from 2.3% in October, the highest since March. It was, however, largely in line with expectations.
The ONS said the prices of motor fuel and clothing had driven the increase, although that had been partially offset by a bigger-than-normal fall in air fares.
Core CPI, which strips out the more volatile elements of energy, food alcohol and tobacco, rose by 3.5% in the 12 months to November, a jump from 3.3% in October.
Paul Dales, chief UK economist at Capital Economics, said the further rebound in CPI inflation could have been worse.
"But coming on the back of the stronger-than-expected rebound in wage growth in yesterday's release, there is almost no chance of the Bank of England delivering an early Christmas present with another interest rate cut tomorrow."
Looking ahead to the rest of the day, eyes will be on the Fed interest rate decision at 1900 GMT.
Danske Bank said: "We expect a 25bp cut, which is also fully discounted by markets. Apart from the rate decision, market attention will be on the updated rate projections, and especially on the FOMC's latest view on the terminal rate level.
"We think Chair Powell will aim for a neutral tone in his remarks, but he is still likely to verbally open the door for slowing the pace of cuts."
In corporate news, DIY group Kingfisher announced the sale of its Brico Dépôt business in Romania to retailer Altex Romania for €70m.
The Bucharest-headquartered subsidiary comprises 31 stores across 24 cities, along with distribution operations.
Kingfisher said the divestment will give it "greater strategic focus on markets and growth initiatives where we are most strongly positioned to deliver attractive returns and create shareholder value".
National Grid said it planned to invest up to £35bn in Britain's electricity network over a five-year period from April 2026.
The plan includes £11bn to maintain and upgrade existing networks, alongside construction works for the first three of its accelerated strategic transmission investment projects.
A further £24bn has been allocated to future projects, including around £15bn to increase network capacity.
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