London pre-open: Flat start expected for FTSE

31st Jul 2012 07:35

City sources predict the FTSE 100 will open down just one point from yesterday's close of 5,694 as investors await central bank meetings set to take place later this week. Investors have grown increasingly optimistic of late that the world´s monetary authorities will move to butress growth, particularly in the US but above all in the Eurozone; expectations are extremely high for the European Central Bank´s next policy meeting this next Thursday.Against that background perhaps the most important piece of news today may be the release of the private sector audit results of Spain´s financial system.As well, investors will be bracing for a spate of first tier economic indicators due out Stateside this afternoon. Back in the UK, the GfK consumer confidence gauge for the month of June remained stable at -29.India´s central bank kept its main policy rate unchanged last night, at 8%, although it did lower its deposit requirement for banks. Scottish engineering firm Weir has advised that full year profits are likely to come in below market expectations if there is no pick-up in the upstream Oil & Gas markets. The cautious outlook statement overshadowed a solid set of interim figures from the group. Revenue in the 26 weeks ended June 29th rose 29% to £1,031m from £1,325m the year before. Order input failed to keep pace with revenue growth, however, advancing 8% to £1,312m from £1,220m the year before.Diversified mining group Xstrata saw stronger second-quarter production in coal, nickel, zinc and lead compared with the first quarter, but it was more of a mixed picture for the first half as a whole. Total mined copper output rose 7% quarter-on-quarter (q/q) in the three months to June 30th, helped by volumes from the recently commissioned Antamina expansion. However, volumes in the first half as a whole were down 18% on last year as the group continued its transition from older end-of-life mines to new mines and expansion projects - these are expected to increase overall production volumes going into the second half.Weaker oil and gas prices and a cut in output due to an extensive maintenance programme hit BP's profits hard in the second quarter. The company's underlying replacement cost profit for the quarter was $3.7bn, down from $5.7bn for the same period in 2011 and $4.8bn the previous quarter. Production, excluding output from the Russian TNK-BP venture, fell 8% to 2.3m barrels of oil equivalent a day.