Portfolio

London pre-open: Stocks to recover but coronavirus worries remain

By Michele Maatouk

Date: Tuesday 28 Jan 2020

London pre-open: Stocks to recover but coronavirus worries remain

(Sharecast News) - London stocks were set to rise at the open on Tuesday, recovering from heavy losses in the previous session, but worries about the coronavirus were expected to continue to weigh on sentiment.
The FTSE 100 was called to open 23 points higher at 7,437.

London Capital Group analyst Jasper Lawler said: "Financial markets remain in the grip of a huge flight to safety because of the coronavirus outbreak in Wuhan China. The death toll in China has risen to 106 with 4193 total cases according China's People's Daily Newspaper while Germany has reported its first case. Several Western countries have issued travel warnings regarding flights to China, and Facebook has advised employees not to travel to China unless urgent. The UK, along with the United States and other countries are planning to evacuate citizens out of Hubei province, home to Wuhan city.

"Reports are also starting to emerge about the low quality of healthcare being received by potential victims of the coronavirus in the Communist-controlled country. Unavailable testing kits, inadequate quarantine conditions and not monitoring those suspected of contracting the virus could all have contributed to its spread."

On the data front, the CBI industrial trades survey for January is due at 1100 GMT.

In UK corporate news, Irn-Bru maker AG Barr said full year adjusted profit before tax was expected to be at the top end of current market expectations, just ahead of £37m.

Revenue for the period was expected to be around £255m, down from £279m a year earlier.

The company said it had faced a "combination of challenging trading conditions during the year, particularly across the summer period", and had adjusted its promotional and pricing position to align more closely with the market.

"While this had an expected impact on volume, it has delivered an increase in average realised price, re-establishing our consumer pricing position," it added.

Severn Trent said its dividend would rise at least in line with consumer prices over the next five years as the water company posted a performance and outlook in line with guidance.

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