FTSE 100 preview: Index seen lower after record highs

Shell to take on UK’s Big Six energy suppliers

FTSE 100 preview: Index seen lower after record highs

The UK benchmark index looks set to open lower this morning, taking a breather after passing the 7,600-point level for the first time ever yesterday. Royal Dutch Shell’s (LON:RDSA) acquisition of First Utility will be in focus on the corporate front today.

FTSE 100 seen lower

IG’s opening calls suggest that the FTSE 100 will open 0.22 percent lower at 7,587 points. Sentiment is likely to be subdued on the last trading day before Christmas. On the other side of the Atlantic, shares closed higher last night, with investors continuing to digest the tax bill which is set to cut corporate taxes.

CNBC quoted Alberto Gallo, partner at Algebris Investments, as saying in a note that the tax cuts “will support growth in 2018, acting as a tailwind to both consumption and capital spending”. Asian shares meanwhile have tracked the US higher this morning.

At home, the Footsie soared yesterday, adding 78.76 points to end the session 1.05 percent higher at 7,603.98, posting a record high, with the tax reform bill in the US helping fuel a Christmas rally.

“Everyone was expecting a Santa rally and because of that they’re not selling: it’s a self-fulfilling prophecy,” said Forex.com market analyst Fawad Razaqzada, as quoted by Reuters, adding that the lack of volumes had exacerbated price moves.

Friday’s calendar

Investors have a lot to look forward to on the macroeconomic front today, with Germany’s GfK consumer confidence index for January due out at 07:00 GMT, to be followed by the final estimate for the UK’s third-quarter gross domestic product at 09:30 GMT. IG reports that the quarter-on-quarter rate is expected to be unrevised at 0.4 percent. In the US, the nation’s durable goods orders for November are scheduled to be released at 13:30 GMT, to be followed by November’s new home sales and the final December Michigan consumer confidence index at 15:00 GMT.

In company news, The Times reports that Shell is to take on Britain’s Big Six energy suppliers by acquiring their largest challenger, First Utility.

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