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London pre-open: Stocks seen lower ahead of payrolls

By Michele Maatouk

Date: Friday 03 Apr 2020

London pre-open: Stocks seen lower ahead of payrolls

(Sharecast News) - London stocks were set to fall at the open on Friday as investors continued to fret about the impact of the coronavirus pandemic and looked ahead to the release of the latest US non-farm payrolls report.
The FTSE 100 was called to open 62 points lower at 5,418.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: "The US non-farm payrolls are expected to unveil 100,000 job losses in March. But looking at the devastating jobless claims figures, it is possible we see significantly worse figures.

"As we mentioned in our earlier reports, the US dollar should not fall from grace with bad US data, on the contrary, as investors have no safer place to flee. Hence, we may see a reversed relationship between data and the USD appetite. A better data would be more efficient in softening the US dollar before the weekly closing bell."

The payrolls report, unemployment rate and average earnings are due at 1330 BST.

In corporate news, BAE Systems has withdrawn its dividend and put financial guidance on hold after the Covid-19 crisis began to cause major disruptions to its business. The FTSE 100 defence company said it had a strong balance sheet and a long order backlog but that it was in the company's interests to defer the 13.8p final dividend proposed in February.

Primark owner Associated British Foods said its chief executive and finance director had volunteered to take a 50% pay cut in response to the coronavirus pandemic.

CEO George Weston finance director and John Bason requested the reduction in base salary as had Primark chief Paul Marchant. ABF added that executive bonuses for the current financial year would be axed and non-executive director fees reduced temporarily by 25%.

Ascential said it was pulling its final 4p dividend and cancelling the Cannes Lions advertising conference in response to the coronavirus pandemic. The company also froze executive pay rises and imposed a temporary 25% board room pay cut.



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