FTSE 100 preview: US presidential debate and OPEC meeting to weigh on sentiment

on Sep 26, 2016

The UK benchmark index looks set to start the week on the back foot, with investors staying on the sidelines ahead of this week’s meeting of the Organisation of the Petroleum Exporting Countries (OPEC) and a presidential debate on the other side of the Atlantic. Tesco (LON:TSCO) will be in focus on the corporate front amid potential scrutiny over its workplace pensions.

IG’s opening calls suggest that the FTSE 100 will start the day 0.38 percent in the red at 6,883. The Footsie is likely to take cues from the US, where stocks ended Friday’s session in the red ahead of OPEC’s meeting.
“You never know what’s going to happen with these OPEC meetings,” Robert Pavlik, chief market strategist at Boston Private Wealth, told CNBC. “You have Saudi Arabia offering a cut, but for that to happen Iran would have to agree to a [production cap].”
Investors are also likely to remain cautious ahead of the first US presidential debate later today.
“Clinton will be trying to win over Republicans who are disaffected with Trump but yet don’t trust her, while Trump will be trying to win over those independents who aren’t sure whether he’s Presidential material,” Marshall Gittler, head of investment research at FXPrimus, said in a note, as quoted by Reuters. Asian stocks meanwhile have retreated this morning, tracking the US lower.
At home, the FTSE 100 closed little changed on Friday, shedding 1.97 points to end the session 0.03 percent lower at 6,909.43. Despite the decline, the blue-chip index posted its best week in almost three months, after the decision of the US Federal Reserve to refrain from raising rates pushed the Footsie higher earlier during the week.
Today’s macroeconomic releases include the German IFO business climate index for September, due out at 09:00 BST. In the US, new home sales data for August are set to be released at 15:00 BST. On the corporate front, Carnival (LON:CCL) will post its second-quarter results this afternoon. In other company news, The Times reports that Tesco could be called before the Commons inquiry into workplace pensions amid claims that the hole in its pension fund could be up to £6.5 billion.

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