The UK benchmark index looks set to start the week on the front foot, despite concerns over the US tax reform, finding support in lower sterling. Tesco (LON:TSCO) will be in focus in today’s session amid reports that it is being sued by a former executive.
Upbeat start to week
IG’s opening calls suggest that the Footsie will start the session 0.32 percent higher at 7,457 points. Reuters notes that sterling has retreated this morning after the Times of London reported yesterday that 40 Tory lawmakers have agreed to sign a letter of no confidence in Prime Minister Theresa May. A drop in the pound tends to benefit blue-chips with international exposure.
In the US, stocks ended the previous session lower, pressured by a fall in tech shares.
“Short-term overbought conditions are still in place, so we think it will take a couple of weeks for the pullback to run its course,” said Katie Stockton, chief technical strategist at BTIG, as quoted by CNBC. “The loss of momentum is likely to be most pronounced in stocks that have extended their uptrends over the past several weeks.” Asian shares meanwhile have tracked the US lower this morning.
In the UK, the FTSE 100 lost ground on Friday, shedding 51.11 points to end the session 0.68 percent lower at 7,432.99, pressured by retailers.
There are no major macroeconomic releases out of Europe to provide direction this morning. In company reports, Taylor Wimpey (LON:TW) is scheduled to update investors on its recent performance. In other news, The Times reports that Tesco’s former commercial director is suing his ex-employer for alleged unfair dismissal, while The Telegraph has revealed that Unilever’s (LON:ULVR) Dutch Works Council is threatening to call for strike action across the consumer goods giant’s global factories if potential buyers of its margarine business fail to agree to protect jobs and pension guarantees.