FTSE 100 preview: Index seen lower as US tax worries return

The UK benchmark index looks set to open lower this morning, with investors continuing to digest this week’s string of central bank decisions and ongoing worries over the US tax reform. Lloyds Banking Group (LON:LLOY) will be in focus on the corporate front today, amid the latest developments related to the ongoing shareholder trial over the lender’s acquisition of HBOS at the height of the financial crisis.

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FTSE 100 to open lower

IG’s opening calls suggest that the Footsie will start the session 0.08 percent lower at 7,442 points. The index is likely to take cues from the US, where shares drifted lower last night, as two Republican Senators raised some concerns about the tax bill.

“This market has been going in lockstep with the progress made in the tax bill,” said Art Hogan, chief market strategist at B. Riley FBR, as quoted by CNBC. “When you see bumps in the road, you’re going to get some volatility.” Asian shares meanwhile have come under pressure this morning.

At home, the Footsie gave up 48.39 points to close 0.65 percent lower at 7,445.12, after the Bank of England left rates unchanged yesterday.

“Although inflation has jumped to its highest level in almost six years, it seems that the growing uncertainty over Brexit is likely to encourage the central bank to adopt a wait and see approach moving forward,” Lukman Otunuga, analyst at FXTM, told Reuters.

Quiet Friday ahead

There are no major macroeconomic releases out of Europe to provide direction this morning and no blue-chip companies are scheduled to update investors on their performance. In company news, The Times reports that the former head of the City regulator has denied it leaned on Lloyds to take over its stricken rival HBOS in 2008.