London pre-open: Markets expected to extend losses as new week begins

24th Jun 2013 07:28

The UK stock market is expected to track Asian markets lower on Monday as sentiment remains fragile following the dramatic sell-off last week which saw the FTSE 100 slip to five-month lows.City sources predict the London benchmark index will open down 19 points from yesterday's close of 6,116. Since hitting a 13-year high on May 22nd, the Footsie has now dropped nearly 11%." There is no doubt that the markets are still in the process of pricing in the Federal Reserve's plan to tone down its stimulus drive later this year," said Financial Sales Trader Max Cohen from Spreadex this morning.He said that after recent steep falls, "investors will be hesitant to enter at current levels consider the volatility".Stocks to watchVodafone has confirmed its intention to acquire Germany's biggest cable company for more than £8.5bn. In one of the biggest deals the telecoms industry has seen since the height of the technology boom, Kabel is expected to recommend the offer to shareholders, according to The Times.Diversified mining giant Rio Tinto has decided to keep hold of its diamonds business saying that market fundamentals remain robust, with growing demand for luxury goods in Asia and continued strong demand in the US. The Chief Executive of the Diamonds & Minerals division, Alan Davies, said: "After considering a number of alternative strategic ownership options it is clear the best path to generate maximum value for our shareholders is to retain these businesses."FTSE 250 sausage skins maker Devro said first half sales of edible collagen are expected to rise modestly from a year earlier and it remains confident of a strong second half and growth in full year earnings. The Scotland-based firm said sales are expected to increase 1.0% while the average price per unit sold has increased around 2.0%, equivalent to recent input cost increases.BC