The FTSE 100 looks set to open higher this morning, after US President Donald Trump announced that he was pulling the country out of the Iran nuclear deal. Vodafone (LON:VOD) will be in focus on the corporate front amid reports that it is buying assets from Liberty Global.
Index seen steady
IG’s opening calls suggest that the Footsie will start the session 0.11 percent higher at 7,574 points. In the US, stocks closed little changed last night following Trump’s announcement that he was withdrawing the US. from the Iran nuclear deal signed by the Obama administration about three years ago. Quincy Krosby, chief market strategist at Prudential Financial, told CNBC that the market will view the announcement as preview on “how he deals with other foreign policy matters such as North Korea”.
Asian shares meanwhile have been subdued this morning, while oil has surged following Trump’s move which has fuelled supply fears.
“In the very short term, it looks as if the impact of heightened geopolitical worries was limited to oil markets. But that is not the end of the story,” said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities, as quoted by Reuters. “US sanctions could affect various industries. And tensions between Iran and Israel look set to intensify. Those will begin to cap share prices.”
In the UK, the FTSE 100 closed little changed yesterday, shedding 1.39 points to close 0.02 percent in the red at 7,565.75. Shire (LON:SHP) was the session’s most notable riser, adding 4.63 percent, after agreeing a tie-up deal with Takeda Pharmaceuticals.
There are no major macroeconomic releases out of Europe to guide the market this morning. In the US, the nation’s producer price index for April is scheduled to be announced at 13:30 BST. On the corporate front, investors will eye updates by Imperial Brands (LON:IMB), Compass Group (LON:CPG) and G4S (LON:GFS). In other news, The Times reports that Vodafone was on the brink last night of announcing a €19 billion (£16.7 billion) deal to buy a significant part of Liberty Global’s European cable business.