FTSE 100 preview: Footsie set for higher opening ahead of Putin Crimea speech

on Mar 18, 2014
Updated: Apr 9, 2020

iNVEZZ.com, Tuesday, March 18: The FTSE 100 is expected to open higher this morning as tensions in Ukraine recede and investors await an address by Russian Federation president Vladimir Putin.

Trading platform IG is picking the Footsie to open today five points higher at 6,573 points. The day’s earnings reports includes a full-year update from Chile-based copper miner Antofagasta (LON:ANTO) and Guernsey-incorporated investment vehicle Resolution Ltd (LON:RSL).
Investors will also be eyeing the release of J Sainsbury’s (LON:SBRY) fourth-quarter trading statement, amidst mounting pressure on Britain’s biggest supermarket chains.

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IG Markets trader Chris Weston said in a morning note: “We are likely to see fairly subdued trade until we get a clearer idea around Vladimir Putin’s actions and thoughts.”
The US and EU yesterday slapped sanctions on 11 Russian and Ukrainian officials, following Sunday’s referendum in Crimea. Putin is expected to address the Russian parliament later today on making Crimea part of the Russian Federation, a day after signing a decree recognising the region as a sovereign state.

Yesterday, Britain’s blue-chip index closed 40.46 points or 0.62 percent higher at 6,568.35p, recovering from last week’s slump. The Footsie was lifted by a strong performance amongst housebuilders on news of the government’s decision to extend its ‘Help to Buy’ housing stimulus scheme (FTSE 100 watch: Housebuilders lead Footsie higher).

Asian stocks rebounded today, with the MSCI Asia Pacific Index rising from a five-week low. There was a rally in US stocks also yesterday, as tension in respect of Ukraine abated somewhat following the sanctions imposition and news came of a six-month high climb last month in US manufacturing output.
Investor focus now turns to the start later today of the Federal Open Market Committee’s two-day meeting, with the outcome widely expected to be a further trimming of asset purchases.

***Antofagasta, Resolution release finals***
Antofagasta is expected to report a drop in annual revenues and earnings due to lower metal prices and higher costs. Numis predicts the miner will post a 34 percent year-on–year drop in earnings per share to $0.85, with revenues of $5.95 billion.
“We forecast earnings before interest, tax, depreciation and amortisation (EBITDA) of $2.73bn and net cash of $1.83bn,” Numis said.

The broker sees dividend being maintained at a full-year 30 cents per share and expects “full year 2014 guidance to be maintained at circa 700,000 tonnes of copper, 270,000 ounces gold and 7,500 tonnes molybdenum at net cash cost of $1.45 per pound”.
Resolution Ltd is also due to update the market on its annual performance today. Last November, the financial services restructuring company released its Q3 interim management statement, showing that the company had performed strongly during the period (Resolution share price: Goldman Sachs reiterates ‘Neutral’ rating on company’s stock).
***Investors brace for ‘grim reading’ of Sainsbury’s Q4***
The pressure on the UK’s biggest supermarket retailers will be underscored if, as expected, J Sainsbury reports its first decline in like-for-like sales for almost a decade. Sainsbury’s has racked up 36 consecutive quarters of like-for-like sales growth under CEO Justin King, but that is expected to end today.
Analysts at Barclays and Agency Partners are picking a three percent decline in like-for-like sales for the group’s financial fourth quarter. Agency Partners analyst Andrew Porteous, observed: “Reflective of difficult comparatives and slowing industry growth, the statement is likely to make for grim reading.”


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