FTSE 100 preview: Index to open lower as US worries continue

The UK benchmark index looks set to start the day on the back foot, amid ongoing worries over a potential government shutdown in the US. HSBC Holdings (LON:HSBA) will be in focus today, having agreed to pay about $100 million in forex settlement.

FTSE 100 to open lower

IG’s opening calls suggest that the Footsie will start the last trading session of the week 0.11 percent lower at 7,692 points. The blue-chip index looks set to take cues from the US, where shares retreated last night amid worries that the government might shut down at the end of the week unless Congress passes a spending bill by the end of Friday.

“This is definitely related to the shutdown,” said Larry McDonald, head of the US macro strategies at ACG Analytics and creator of The Bear Traps Report, as quoted by CNBC. “The chances of a shutdown have increased in the past few weeks, but the market's been ignoring it.” Asian shares meanwhile have been mixed this morning.

In the UK, the FTSE 100 lost 24.47 points to end Thursday’s session 0.32 percent lower at 7,700.96, with investors continuing to focus on company releases. Associated British Foods (LON:ABF) was the session’s biggest faller in percentage terms, closing 3.57 percent in the red, after warning of lower revenues and profits from its sugar business.

Friday’s calendar

Today’s macroeconomic releases include UK retail sales data for December due out at 09:30 GMT. IG reports that sales are forecast to have climbed 0.3 percent year-on-year from 1.6 percent and 0.4 percent month-on-month from 1.1 percent. In the US, the preliminary January Michigan confidence index is scheduled to be released at 15:00 GMT. In company news, Bloomberg reports that HSBC has agreed to pay about $100 million in penalties to resolve a US Justice Department investigation into the rigging of currency rates.