London pre-open: Investors gear up for busy week

28th Jul 2014 07:37

The FTSE is set for a small gain early on, ahead of what is set to be a busy week, particularly in the latter half. The top tier index is predicted to open around 20 points higher than Friday's close of 6,791.55, according to City sources. With geopolitical tensions continuing to be in focus, traders will also be looking to the many corporate releases and economic data set to be released this week. Alpari UK Analyst Craig Erlam said that with little out from Europe in the early part of the week, "the US is likely to be the biggest driver of most of the major markets this week". He continued: "This is particularly true in the second half of the week when we'll have a barrage of massive economic indicators, almost 100 S&P 500 companies reporting second quarter earnings and a Federal Open Market Committee decision to cap everything off. "Do not underestimate how big an impact that final few days of the week could have on the markets. We've all been looking for that thing that brings volatility back to the markets, well this could well be it."The build up to this could result in some degree of greater risk aversion, he further explained, although the number of companies releasing results will help to limit this. Data that is due to released later on today includes the US July Markit services and composite Purchasing Mangers' Index (PMI) figures, alongside June pending home sales. Back in the UK, and in this morning's company news, National Grid reported a continued "solid operational and financial performance" in the period between April 1st and July 27th, with the UK delivering operational efficiencies and progress with its investment programme, while the US saw a good operational performance. Reckitt Benkiser said that it expects market conditions to remain challenging in the second half of the year, particularly in the US and certain emerging markets, but that it was still on track to achieve its full year total revenue growth target of 4-5%. The household goods group also announced that it is planning to hive off its drug arm into a separate UK-listed company. Randgold Resources said it was focusing on its Tongon gold mine in Côte d'Ivoire where it is "continuing to make headway" in its efforts to overcome the technical issues that have affected its performance. Chief Executive Mark Bristow admitted this year's planned ramp-up in production had not been achieved due to the need to expand the flotation circuit and the mechanical failure of the recently installed Vibrocone crushers, intended to improve the recovery and throughput rate. However, while its performance is therefore expected to show a steady improvement in the second half of the year, Tongon's 2014 production is expected to fall within 10% short of its original guidance of 260,000 ounces. NR