FTSE 100 watch: Index looking up as Fed leaves rates unchanged

The UK benchmark index looks set to start February on the front foot, as the Federal Reserve left rates unchanged. On the corporate front, Royal Dutch Shell (LON:RDSA) is scheduled to post results alongside several other blue-chips.

FTSE 100 looking up

IG’s opening calls suggest that the FTSE 100 will start the session 0.32 percent higher at 7,557 points. The index is expected to regain some of the previous sessions’ hefty losses as the Fed kept rates unchanged. The central bank, however, noted that it expects inflation to move higher this year.

“The statement is pretty consistent with what we’ve seen in the underlying data,” said Erik Schiller, senior portfolio manager at PGIM Fixed Income, as quoted by CNBC. “It was a slightly hawkish statement, in our view. US shares nevertheless rose last night, posting a strong start to the new year. Asian shares meanwhile have been mostly higher this morning, with China underperforming the region despite upbeat manufacturing data.

At home, the Footsie extended the previous session’s hefty losses, shedding 54.43 points to end trading 0.72 percent lower at 7,533.55, pressured by a fall in housebuilders.

Thursday’s releases

Today’s macroeconomic statements include the UK manufacturing purchasing managers’ index for January, due out at 09:30 GMT and IG reports that activity is expected to have increased to 56.5, from 56.3. In the US, the nation’s ISM manufacturing PMI for January is scheduled to be released at 15:00 GMT.

Investors have a lot to look forward to on the corporate front, with Shell expected to unveil a rise in annual profits. Other blue-chips reporting today include Unilever (LON:ULV), 3i Group (LON:III), Glencore (LON:GLEN) and Vodafone (LON:VOD). There are no blue-chips going ex-dividend in today’s session.