FTSE 100 preview: Index to track Asia lower after Apple warning

Written by: Alice Young
January 3, 2019

The UK benchmark index looks set to open lower this morning, with a revenue warning from Apple weighing on sentiment in Asia. On the corporate front, Next (LON:NXT) will kick off the Christmas reporting for blue-chip retailers.

FTSE 100 seen lower

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Reuters reports that the Footsie is seen opening 26 points lower at 6,708, according to financial bookmakers. The blue-chip index is likely to take cues from Asia, where shares have retreated this morning as US tech giant Apple lowered its first-quarter revenue guidance, blaming a slowdown in China and weaker iPhone sales.

“This piles on to existing anxiety of a slowdown in global growth,” said Jeff Kilburg of KKM Financial, as quoted by CNBC. “Apple can be used as a proxy to China’s growth”. In the US, shares posted small gains last night following a volatile session.

At home, the Footsie started the new year marginally higher, inching 6.10 points to close 0.09 percent higher at 6,734.23, recovering from a selloff earlier in the session, as it found support in less risky defensive stocks.

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Thursday’s agenda

Today’s macroeconomic statements include the UK’s construction purchasing managers’ index (PMI) for December, due out at 09:30 GMT and IG reports that the index is expected to have climbed to 53.8, from 53.4. In the US, the ADP employment report for December will be announced at 13:15 GMT, to be followed by the nation’s ISM manufacturing PMI for the same month at 15:00 GMT. Next will be in focus in company news today, with the retailer set to post its Christmas trading update, following smaller London-listed peer Asos’ (LON:ASC) profit warning last month.

Blue-chips, whose shares will be trading without the attraction of their latest dividend this Thursday include Auto Trader (LON:AUTO), British Land (LON:BLND) and Experian. Reuters’ calculations suggest that ex-divs will knock 0.7 points off the Footsie.