FTSE 100 preview: Muted start ahead as China signals lower growth target

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Updated on Aug 13, 2024

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The UK benchmark index looks set to open little changed this morning following news that China had lowered its growth target. In FTSE 100 company news, BP (LON:BP) has named a new head of its wind power business.

Muted start ahead

IG’s opening calls suggest that the Footsie will start trading 0.02 percent higher at 7,136 points this morning. Asian shares have been mixed this morning as China signalled that its official economic growth target this year will be lower than last year.

“I think the bigger point here is that they’re trying to essentially avoid crashing the economy with excess debt while avoiding a very severe downturn in economic activity,” Andrew Collier, managing director at Orient Capital Research, told CNBC’s ‘Street Signs’ this morning. In the US, shares retreated last night. Reuters reported that while an unexpected fall in US construction spending was cited as a factor, other saw the retreat as a long overdue correction.

In the UK, the FTSE 100 started the new week on the front foot, gaining 27.66 points to end trading 0.39 percent higher at 7,134.39, with investors focusing on the prospects for a trade deal between Washington and Beijing.

Tuesday’s releases

Today’s macroeconomic statements include the UK services purchasing managers’ index (PMI) for February, due out at 09:30 GMT and IG reports that the index is expected to have weakened to 49.7 last month, slipping into contraction territory from 50.1. On the other side of the Atlantic, US new homes sales for December and the nation’s ISM non-manufacturing index for February are both due out at 15:00 GMT.

On the corporate font, Ashtead (LON:AHT) and Intertek (LON:ITRK) and Direct Line (LON:DLG) report today. In other news, Reuters reports that the head of BP’s wind energy business Laura Folse will retire at the end of month, and will be replaced by Al Vickers, currently vice president of technical functions in the operations of the group’s upstream, or oil and gas, business.