FTSE 100 preview: Index seen steady as investors await Fed decision

FTSE 100 preview: Index seen steady as investors await Fed decision

The UK benchmark index looks set to open marginally higher this morning ahead of a policy announcement by the US Federal Reserve. Investors will be eyeing a string of corporate releases, including updates by GSK (LON:GSK) and ITV (LON:ITV).

IG’s opening calls suggest that the FTSE 100 will start the session four points higher at 7,439. US shares closed higher last night, with investors focusing on better-than-expected earnings. In Asia, shares have been steady this morning ahead of the Fed rate decision.

“The stock markets are generally of a view that the Fed is not in too much of a hurry to normalise monetary policy,” Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management, told Reuters. “So, equities would be able to take this Fed meeting in stride if the Fed’s statement is in line with such views.”

The Footsie rose in the previous session recovering some of the ground lost earlier in the week, gaining 57.09 points to end the session 0.77 percent higher at 7,434.82. The blue-chip index found support in strong miners which tracked copper higher. Antofagasta (LON:ANTO) was the session’s biggest riser in percentage terms, adding 7.46 percent to close at 951.00p.

Today’s macroeconomic calendar includes the preliminary estimate for the UK’s second-quarter gross domestic product due out at 09:30 BST and IG reports that growth is expected to come in at 1.8 percent year-on-year and 0.4 percent quarter-on-quarter. In the US, the nation’s flash Markit services purchasing managers’ index for July is scheduled to be released at 14:45 BST, to be followed by new home sales data for June at 15:00 BST. The Fed policy statement is expected at 19:00 BST, after the London market closes.

In company news, ITV will post results after unveiling that it had appointed easyJet’s (LON:EZJ) chief executive as its new boss, while GSK’s CEO is largely expected to lay out plans to boost the group’s pharmaceutical division, alongside announcing the group’s half-year results. Other blue-chips reporting today include Hammerson (LON:HMSO), GKN (LON:GKN), Fresnillo (LON:FRES) The Sage Group (LON:SGE), and Compass Group (LON:CPG). 

By Alice Young
Alice joined the Invezz team after motherhood convinced her to make a career change from actuary-ing. She brings a forensic eye for detail developed through crunching numbers on underwriting satellite insurance and the like.
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