Portfolio

London pre-open: Stocks seen lower as Asian markets slide; UK jobs data eyed

By Michele Maatouk

Date: Tuesday 21 Jan 2020

London pre-open: Stocks seen lower as Asian markets slide; UK jobs data eyed

(Sharecast News) - London stocks were set to fall at the open on Tuesday, taking their cue from a weak session in Asia, where sentiment was hit by worries about coronavirus and Moody's downgrade of Hong Kong's credit rating.
The FTSE 100 was called to open down 44 points at 7,607.

Stocks in Asia slid after Moody's downgraded its rating on Hong Kong to Aa2 from Aa3 and cut the outlook to negative from stable following months of pro-democracy protests. In addition, concerns about the coronavirus added to the downbeat mood after China confirmed that it can spread between humans.

On home shores, all eyes will be on the release of the ILO unemployment rate, claimant count and average earnings, all due at 0930 GMT.

London Capital Group analyst Jasper Lawler said: "GBPUSD has been stubbornly clinging onto $1.30 despite a series of disappointing economic data, including the longest run of retail sales declines on record.

"The unemployment figures are one of the last major datapoints before Bank of England decision next week. If cracks show up in the UK labour market, we suspect that might be the straw that breaks the camel's back on a January rate cut."

In corporate news, BHP maintained full year guidance for iron ore and thermal coal, despite the impact of the Australian bushfires on its coal operations. Thermal coal output fell 11% in the first half to 7m tonnes, BHP said as it released its December quarter production report and maintained its full year forecast of between 15m - 17m tonnes.

"We are monitoring the situation and if air quality continues to deteriorate then operations could be constrained further in the second half of the year," the company said.

Australian iron ore output fell almost 2% quarter on quarter to 68m tonnes in the three months to December 30, but up 3% year on year. The full year forecast was held at 273m - 286m tonnes.

BP announced that its chief financial officer Brian Gilvary has decided to retire from the company and step down from its board on 30 June.

The FTSE 100 oil major said Gilvary had a career spanning 34 years with BP, including over eight years as CFO.

He would be succeeded by Murray Auchincloss, currently CFO of BP's upstream segment, who would take up the role of CFO and join the board on 1 July.

Gilvary and Auchincloss would work together between now and the end of June to ensure an orderly transition, the board said.



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