FTSE 100 preview: Upbeat start ahead as Trump tax optimism continues

on Feb 13, 2017

The UK benchmark index looks set to kick off the week on an upbeat note, taking cues from the US and Asia, where stocks have been supported by President Donald Trump’s promise for tax reform. Barclays (LON:BARC) will be in focus today amid reports that it has moved to freeze the pay of its chief executive.

IG’s opening calls suggest that the Footsie will start the week 10 points higher at 7,269. US stocks closed higher on Friday following Trump’s promise to release a tax plan in near future.
“Investors were worried that the tax plan was pushed to the backburner. Now, investors are celebrating that it’s not,” said Kim Forrest, senior equity analyst at Fort Pitt Capital, as quoted by CNBC. Asian stocks have tracked the US higher this morning.

“The global economy seems fairly sound now, compared to last year, as China is supporting its economy through fiscal measures. The downside risk in the US economy is small due to Trump’s policies,” Masayuki Kichikawa, chief macro strategist at Sumitomo Mitsui Asset Management, told Reuters.
The Footsie closed in positive territory on Friday, adding 29.25 points to end the session 0.40 percent higher at 7,258.75, finding support in mining stocks. Rio Tinto (LON:RIO) was the biggest blue-chip riser in percentage terms, adding 5.63 percent to 3,572.50p.
Today’s macroeconomic releases include the monthly OPEC report, to be unveiled late morning. There are no blue-chip companies scheduled to update the market on their recent performance this morning. The Times meanwhile reports that Barclays has proposed freezing its chief executive’s maximum pay package for three years as it seeks to avoid the pay disputes engulfing other companies.

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