FTSE 100 preview: UK stocks set to rise on upbeat US jobs data

on Nov 22, 2013
Updated: Oct 21, 2019

iNVEZZ.com, Friday, November 22: Britain’s benchmark equity index, the FTSE 100, is expected to open higher today, tracking US markets, which were buoyed by better-than-expected jobs data. US initial jobless claims in the week ended November 16 fell by 21,000 to 323,000, the fewest since the week ended September 28. Economists had projected a higher figure of 335,000. While the improvement in the labour market suggests that the Federal Reserve might start winding down its monetary stimulus programme soon, equity markets appear to be increasingly prepared to swallow the move, so long as the economy appears to be on a sustainable growth path. Moreover, the minutes from Fed’s October policy meeting indicate that the central bank will aim to hold down rate-hike expectations once it begins to taper bond purchases. This could mitigate the impact of scaling back its $85 billion-a-month asset purchase programme.

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The FTSE 100 index is expected to open 19 points, or 0.3 percent, higher today, according to financial bookmakers. Yesterday, the Footsie edged marginally higher to close at 6,681.33.
US equity markets advanced yesterday, breaking a three-day losing streak. The Dow Jones Industrial Average rose 0.69 percent to close at a new all-time high of 16,009.99. The benchmark Standard & Poor’s 500 Index gained 0.81 percent to finish at 1,795.85.

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Asian equity markets were mostly higher overnight. Japan’s benchmark index, the NIKKEI 225, extended yesterday’s gains, closing 0.1 percent higher at 15,381.72, helped by a further weakening of the yen that buoyed exporters’ shares. Bank of Japan Governor Haruhiko Kuroda supported the depreciation of the currency, which boosts the sales and earnings of local manufacturers, saying the yen was not abnormally low and there were no signs of a bubble in shares.

**Earnings reports**

It will be a quiet day for earnings reports. Brewer and pub operator Fuller Smith & Turner (LON:FSTA) will release its interim results for the six months to the end of September. Panmure Gordon has forecast the brewer of London Pride to post a pre-tax profit of £18.3 million. Media group Future PLC (LON:FUTR) and Norway-based oil and gas company Bridge Energy (LON:BRDG) will also update the market today.

On the macroeconomic front, Germany is due to release GDP and business confidence data. Europe’s biggest economy is expected to report 0.6 percent economic growth in the third quarter, while business sentiment is forecast to improve in November.
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