FTSE 100 preview: Trade fears to weigh on Footsie

FTSE 100 preview: Trade fears to weigh on Footsie
Written by:
Tsveta van Son
May 9, 2019

The FTSE 100 looks poised for a downbeat start this Thursday, with US-China trade worries weighing on market sentiment around the world. On the corporate front, BT Group (LON:BT.A) will post its preliminary results this morning, while Wm Morrison Supermarkets (LON:MRW) is scheduled to update investors on its first-quarter performance.

FTSE 100 seen lower

IG’s opening calls suggest that the Footsie will start trading 0.40 percent in the red at 7,242 points. The blue-chip index is likely to take cues from the US where shares were mixed last night amid the ongoing trade standoff between Washington and Beijing. Sentiment has been subdued as China signalled that it would take countermeasures if the US hiked tariffs on Friday.

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“It’s another cliffhanger,” said Larry Adam, chief investment officer at Raymond James, as quoted by CNBC, referring to President Donald Trump’s tariff threat on Sunday. “There are so many levers that can be pulled here. I still think ultimately we do end up getting a deal because it’s too important for both economies.” Asian shares meanwhile have fallen into the red this morning.

At home, the Footsie closed marginally higher yesterday, added 10.53 points to end trading 0.15 percent higher at 7,271.00, finding support in hopes over the US-China trade relations.

Thursday’s agenda

There are no major macroeconomic releases out of Europe to guide the market further this morning. In the US, the nation’s trade balance for March will be announced at 13:30 BST and IG reports that the trade deficit is expected to have widened to $51 billion.

In addition to BT and Morrisons, other blue-chips reporting today include RSA Insurance (LON:RSA) and Barratt Developments (LON:BDEV). FTSE 100 companies, whose shares will be trading without the attraction of their latest dividend, include Admiral (LON:ADM), BP (LON:BP), Centrica (LON:CNA) and Hiscox (LON:HSX). Reuters’ calculations suggest that ex-divs will knock 8.8 points off the Footsie.