London pre-open: Eurozone worries to dampen spirits

26th Oct 2012 07:33

City sources predict the FTSE 100 will open down 35 points from yesterday's close of 5,805, hit by a renewed concern over the Eurozone after the International Monetary Fund released a worrying report on the debt loads of Greece, Ireland and Spain.Worsening the situation, Standard and Poor's has downgraded BNP Paribas as well as giving a negative outlook on 10 other French banks, which included both Société Générale and Crédit Agricole. The main US equity benchmarks ended Thursday in positive territory after the release of somewhat positive economic indicators. The gains were limited, however, by the news flow on the corporate front which was mixed at best, although generally better than when compared with that of the last few days. In company news, Cynthis Carroll, the Chief Executive Officer (CEO) of diversified mining titan Anglo American, has resigned, the firm said on Friday morning. Carroll, who joined the Anglo American board in January 2007 and took up the CEO position in March of that year, is also to relinquish her position as Chairman of both Anglo American Platinum (Amplats) and De Beers when she steps down. However, she will retain her respective positions until a successor has been found and an appropriate transition has taken place, Anglo said. The company has commenced the look-out for another CEO.African Barrick Gold (ABG) has been forced to scale back its production guidance for the full year after a "challenging" third quarter which saw output and sales shrink dramatically year-on-year. The company has reduced its anticipated full-year volumes by 5-10%. Revenues in the three months to September 30th were $265m, well below the $354m reported in the third quarter of 2011. Meanwhile, the cash margin sunk from $1,087 per ounce (oz) to $723/oz.Reinforced polymer technology firm Fenner said on Friday that its wholly owned subsidiary, Fenner Dunlop Australia, has agreed to acquire 100 per cent of he share capital of ACE, a privately owned group of companies based in New South Wales, Australia, which specialises in supplying engineered conveyor solutions for the design, manufacture and installation of high capacity conveyor systems. The audited value of the gross assets of ACE totalled £10.4m at the mid-year point. The transaction is expected to complete at the end of next month.With UK corporate announcements thin on the ground on Friday, US data will be closely watched by the markets, as all eyes turn to how the economic recovery is doing in the lead up to the presidential elections next month. The big one, the US gross domestic product report, will be released at 13:30 (London time) with the consensus of analysts expecting the economy to expand at an annualised rate of 1.9% in the third quarter, an acceleration from the 1.3% growth in the preceding three months. Another key indicator for the US economy is the final reading of the University of Michigan consumer confidence index which is also due out tomorrow afternoon. The index is forecast to fall slightly from 83.1 to 83 in October. NR