FTSE 100 preview: Index looking up despite US selloff

Sainsbury’s in focus as farmers flag Asda deal concerns

FTSE 100 preview: Index looking up despite US selloff

The UK benchmark index looks set to open higher this morning, recouping some of the losses posted in the previous session, despite a downbeat lead from the US where this week’s selloff continued last night. J Sainsbury (LON:SBRY) will be in focus amid the latest comments over the group’s proposed tie-up with Walmart’s Asda.

FTSE 100 to open higher

IG’s opening calls suggest that the Footsie will start trading 0.25 percent higher at 6,965 points. Investors are likely to shrug off a downbeat lead from the US where shares fell sharply last night, pressured by tech stocks and retailers.

“This looks like lingering worries about what triggered the October decline. That’s worries about an economic slowdown,” said Craig Callahan, president at Icon Funds, as quoted by CNBC. “I think these people are wrong, but they're in control at this time.” Asian shares have also fell this morning, taking cues from the US.

In the UK, the Footsie added 52.97 points to close 0.76 percent higher at 6,947.92, pressured by Brexit and global trade worries. Compass Group (LON:CPG) was the session’s biggest riser in percentage terms, ending the session 5.39 percent higher, as investors welcomed the catering group’s latest results.

Wednesday’s releases

There are no major macroeconomic statements out of Europe this morning. In the US, the nation’s durable goods orders for October will be announced at 13:30 GMT, to be followed by the University of Michigan confidence survey for November at 15:00 GMT.

On the corporate front, investors will eye updates from The Sage Group (LON:SGE), Johnson Matthey (LON:JMAT), United Utilities (LON:UU) and Kingfisher (LON:KGF). In other news, Reuters reports that the National Farmers Union has cautioned that Sainsbury’s proposed merger with Asda could lead to a further price squeeze for farmers and reduce the choice and innovation of products available for shoppers.

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