The FTSE 100 looks set to open marginally lower this morning, ahead of a Bank of England (BoE) policy announcement, and after the US Federal Reserve dampened investor hopes for more rate cuts. On the corporate front, the summer earnings season is set to continue with results from Barclays (LON:BARC) and Royal Dutch Shell (LON:RDSA).
FTSE 100 seen opening lower
IG’s opening calls suggest that the Footsie will start trading 0.10 percent lower at 7,579 points. In the US, shares tumbled even as the Fed cut rates by 25 basis points, with the central bank’s chair Jerome Powell dampening hopes for more cuts going forward.
“The stock market seemed disappointed with Powell’s performance, perhaps because while Powell did not suggest this was a ‘one-and-done’ cut, there was no overt messaging that a September cut is guaranteed,” said Don Ellenberger, senior portfolio manager at Federated Investors, as quoted by CNBC. Asian shares meanwhile have tracked the US lower this morning.
In the UK, the FTSE 100 fell yesterday, giving up 59.99 points to end trading 0.78 percent lower at 7,586.78 as investors focused on corporate releases.
Earnings season in full swing
Investors have a lot to digest on the corporate front this Thursday, including Barclays’ half-year report which will follow Lloyds’ (LON:LLOY) disappointing interims yesterday. Shell is also reporting today after FTSE 100 peer BP (LON:BP) unveiled better-than-expected quarterly earnings earlier in the week. Other blue-chips set to publish results include London Stock Exchange (LON:LSA), RSA Insurance (LON:RSA), Standard Chartered (LON:STAN), Intertek (LON:ITRK), Capita (LON:CPI), British American Tobacco (LON:BATS) and Rio Tinto (LON:RIO).
On the macroeconomic front, investors will await the UK’s manufacturing purchasing managers’ index (PMI) for July, due out at 09:30 BST. IG reports that the index is expected to have climbed to 49.2, from 48, while still remaining in contraction territory. The BoE rate decision will be announced at 12:00 BST.