FTSE 100 preview: Sharp fall on the cards as global selloff continues

Earnings season continues with BP

FTSE 100 preview: Sharp fall on the cards as global selloff continues

The UK benchmark index looks poised to start the session with a hefty fall, with the global equities selloff picking up pace. On the corporate front, BP (LON:BP) is scheduled to update investors on its fourth-quarter performance this morning.

Selloff to continue

IG’s opening calls suggest that the FTSE 100 will open 3.30 percent lower at 7,093 points this morning. The Footsie is set to extend the previous session’s hefty losses as US stocks fell sharply last night, with the Dow Jones plunging 1,175 points and the S&P 500 posting its worst day in six years.

“This sell-off, in the bigger scheme of things, is not that big. But it is very important in psychological terms,” Quincy Krosby, chief market strategist at Prudential Financial, told CNBC. The ongoing selloff, prompted by last week’s US jobs data, has also intensified in Asia this morning.

“The amount of the sell-off that we are seeing is normal. The speed at which we are doing it is not normal,” Michael Purves, chief global strategist at Weeden & Co in New York, commented, as quoted by Reuters.

In the UK, the Footsie tumbled yesterday, shedding 108.45 points to end the session 1.46 percent in the red at 7,334.98, pressured by the ongoing global selloff. The blue-chip index is down more than four percent in the year-to-date.

Tuesday’s agenda

There are no major macroeconomic releases out of Europe to guide the market this morning. In the US, the nation’s trade balance for December is scheduled to be unveiled at 13:30 GMT. In company releases, BP is expected to follow peer Royal Dutch Shell (LON:RDSA) with reporting a rise in profits for 2017, having benefitted from stronger oil prices. Other blue-chips reporting today include Hargreaves Lansdown (LON:HL) and Babcock (LON:BAB).

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