The FTSE 100 looks set to start this Thursday on the back foot, pressured by tensions between the US and Russia over Syria. GKN (LON:GKN) will return in focus following the latest comments by Airbus’ chief executive over the group’s takeover by Melrose Industries (LON:MRO).
Index to open lower
IG’s opening calls suggest that the Footsie will start the session 0.21 percent lower at 7,242 points. The blue-chip index is likely to take cues from the US where shares fell last night after President Donald Trump warned Russia on Twitter to ‘get ready’ for a possible missile strike on Syria.
“It’s not that this wasn’t expected. Trump had already hinted at a response,” said Quincy Krosby, chief market strategist at Prudential Financial, as quoted by CNBC. “I think the market was caught off-guard by the tone of the response.” Asian shares have tracked the US lower this morning, while oil has advanced.
“I don’t think we are heading into the World War Three but should there be a direct collision between the U.S. and Russia for the first time, that’s the sort of headline that would plunge stock prices,” Hidenori Suezawa, financial market analyst at SMBC Nikko Securities, told Reuters.
In the UK, the Footsie was little changed yesterday, shedding 9.61 points to close 0.13 percent lower at 7,257.14. Tesco (LON:TSCO) was the session’s biggest riser in percentage terms, adding 7.18 percent, after posting an upbeat set of full-year results.
Thursday’s macroeconomic releases include February industrial production data for the eurozone, due out at 10:00 BST. There are no blue-chips scheduled to post results this morning. Blue-chips, whose shares will be trading without the attraction of their latest dividend in today’s session, include ITV (LON:ITV), Paddy Power Betfair (LON:PPB), Reckitt Benckiser (LON:RB), Rentokil (LON:RTO) and Smurfit Kappa (LON:SKG). Reuters’ calculations suggest that ex-divs will knock 4.27 points off the Footsie.
In other news, Bloomberg reports that Airbus’ Chief Executive Officer Tom Enders has signalled that he has not decided whether to oppose the hostile takeover of GKN.