FTSE 100 preview: Index to extend losses as Greek woes continue

on May 12, 2015
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Britain’s blue-chip index is expected to open lower this morning, extending yesterday’s losses, following a downbeat US lead and with investors focusing on the continuing talks between Greece and its eurozone partners. On the corporate front, easyJet (LON:EZJ) is scheduled to release a half-year update.

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CNBC reports that the FTSE 100 is seen opening 15 points lower at 7,014 with talks between Greece and eurozone finance ministers still failing to result in a deal over reforms and aid. US stocks closed in negative territory yesterday, giving up some of Friday’s gains with major government debt markets resuming their selloff, resulting in higher bond yields. Asia-Pacific shares were mixed this morning amid a string of corporate reports and following the downbeat US lead.
“You’ve got a global selling of bonds, not sure of the largest catalyst there,” Art Hogan, chief market strategist at Wunderlich Securities, told CNBC. “The disarray in the bond market is causing disarray in the equity market.”
The Footsie lost 16.97 points yesterday to close 0.24 percent lower at 7,029.85 with Friday’s election rally running out of steam. Reuters reported that while Credit Suisse had upgraded UK equities to “overweight” on the back of the Tories’ election victory last week, the investment bank also warned there would be “ongoing UK uncertainty” over the Conservatives’ slim majority in parliament and the looming referendum on the country’s EU membership.
Royal Mail (LON:RMG) bucked the trend after rival PostNL scrapped the Whistl UK delivery service. Royal Mail’s share price closed 3.9 percent higher at 497.60p, posting the biggest gains in percentage terms.
Macroeconomic releases are in short supply today, with UK industrial and manufacturing production numbers for March scheduled to be released at 09:30 BST. In corporate news, easyJet will update investors on its half-year performance, while Experian (LON:EXPN) will release its preliminary full-year results.

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