FTSE 100 preview: Muted start on the cards after downbeat US lead

on May 12, 2017

The UK benchmark index looks set to start the last trading day of the week little changed, following a downbeat lead from the US where stocks closed lower last night, pressured by the retail sector. Lloyds Banking Group (LON:LLOY) will be in focus today amid reports that it is facing a fine over mis-sold investment products.

CNBC reports that the FTSE 100 is seen opening two points lower at 7,382. Sentiment is expected to be subdued following a plunge in retail stocks in the US last night on the back of Macy’s quarterly results.
“When you look at retail and consumer spending, they reignite concerns about the consumer,” said Phil Blancato, CEO of Ladenburg Thalmann Asset Management, as quoted by CNBC. “The US economy is consumer-driven whether you like it or not.” Asian shares have been trading mostly lower this morning, following the negative handover from the US.

The FTSE 100 closed little changed yesterday, adding 1.39 points to end the session 0.09 percent higher at 7,386.63, following the Bank of England’s (BOE) decision to leave rates unchanged. The BOE, however, trimmed its growth forecast for the current year.
Today’s macroeconomic announcements include Germany’s flash first-quarter gross domestic product estimate, due out at 07:00 BST. On the other side of the Atlantic, the US consumer price index and retail sales for April are scheduled to be released at 13:30 BST, to be followed by the preliminary Michigan confidence index for May at 15:00 BST.
On the corporate front, Provident Financial (LON:PFG) is scheduled to update investors on its first-quarter performance. In other news, The Times reports that Lloyds is set to pay compensation to thousands of customers who were mis-sold supposedly ‘low risk’ investment products which turned out to be highly complex.

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