FTSE 100 preview: Rally to continue ahead of ECB

Written by: Tsveta van Son
March 11, 2020

The FTSE 100 looks set to open higher this morning, extending yesterday’s gains in the run-up to the European Central Bank’s (ECB) policy decision later today. On the corporate front, investors will eye Wm Morrison Supermarkets’  (LON:MRW) interims.

FTSE 100 seen higher

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IG’s opening calls suggest that the Footsie will start Thursday’s session 0.50 percent higher at 7,375 points. In the US, stocks surged last night, boosted by gains in Apple, along with expectations for a rate cut by the Federal Reserve next week.

“The biggest question to be answered coming out of next week’s meeting, however, is what to expect for the fourth quarter,” Willie Delwiche, investment strategist at Baird, said in a note, as quoted by CNBC, adding that the market is currently pricing in at least one more rate cut after next week’s meeting. Asian shares have also advanced this morning, amid hopes for a rate cut at the ECB.

In the UK, the FTSE 100 soared in the previous session, gaining 70.08 points to end trading 0.96 percent higher at 7,338.03 points, amid monetary stimulus prospects. London Stock Exchange (LON:LSE) meanwhile added just under six percent following Hong Kong Exchange’s shock tie-up bid.

Thursday’s agenda

Today’s macroeconomic agenda starts with Germany’s final consumer price index (CPI) for August, due out at 07:00 BST. The ECB rate decision will be announced at 12:45 BST, to be followed by the traditional press conference at 13:30 BST. In the US, the nation’s CPI for August will be announced at 13:30 BST.

In company releases, Morrisons is expected to post a rise in revenue and earnings when it updates investors on its half-year performance this morning. Melrose (LON:MRO) is the only FTSE 100 company, whose shares will be trading without the attraction of their latest dividend this morning, knocking 0.3 points off the blue-chip index, according to Reuters calculations.