London pre-open: FTSE set for small drop ahead of data

28th Aug 2014 07:48

Following a fairly flat session in the US on Wednesday evening, the FTSE is set for a modest decline at Thursday's opening bell, as investors look ahead to a busy day of data and company news. City sources predict the FTSE 100 will open around eight points lower than the previous day's close of 6,830.66.US stocks were little changed on Wednesday after indices hit record levels on the previous day, as investors awaited economic growth data for the second quarter. Revised data is expcected to show that the country's gross domestic product rose at an annualised 3.9% in the second quarter, slightly lower than the initial estimate of 4% growth.Policymakers are assessing the health of the world's biggest economy to determine the best time to raise interest rates.Federal Reserve chair Janet Yellen last Friday signalled that interest rates could rise sooner than previously thought following a raft of data pointing to a fast-paced recovery. Elsewhere on Thursday's agenda is the release of German unemployment figures and German inflation amid the suggestion that the European Central Bank (ECB) will introduce full-on quantitative easing to address price instability. Any indication of weakness in Europe's biggest economy is likely to fuel speculation the ECB will take more action to boost the recovery. Based on the worrying economic situation in the Eurozone, "many of this morning's economic releases out of the Eurozone are likely to move in one direction, and that is down", predicted Alpari UK market analyst Joshua Mahony. "The sentiment within the single currency is certainly not one of it's strongest points and thus when we see the consumer, business and services confidence figures, I fully expect to see significant falls in all three."However, the most important release out of Europe is likely to come in the form of the German jobs report which provides us with yet another look at how the biggest economy in Europe is faring."In UK company news, oil and gas group Tullow has announced several successful drilling results from a series of exploration, appraisal and testing activities conducted in blocks 10BB and 13T onshore Kenya.Specialist healthcare company BTG and its partner SciClone Pharmaceuticals have received approval from the China Food and Drug Administration for the registration of DC Bead for the embolisation of a type of malignant liver tumour.Russian gold miner Petropavlovsk announced record first-half gold production of 306,400 ounces and increased gold sales by 5% year-on-year despite a 12% fall in average gold prices, which hit revenue by 10% to $453m. The group also said it was still on target to achieve an annual 625,000 ounces of gold production at the lower end of its cost guidance range.NR