London pre-open: Markets to extend gains on US, China data

9th Dec 2013 07:36

Markets are expected to open higher on Monday morning, extending gains after a surge the previous session in the aftermath of the better-than-expected US jobs report. City sources predict the FTSE 100 will open up 20 points from yesterday's close of 6,551.99. Global indices gained strongly on Friday after the US data on hopes that the economic recovery my be solid enough to warrant a reduction in stimulus by the Federal Reserve.US non-farm payrolls increased by 203,000 in November, compared with a revised 200,000 gain the month before and well ahead of the consensus forecast for 185,000. Meanwhile, the unemployment rate fell to 7% from 7.3%, below the 7.2% rate estimated by analysts.This follows data earlier in the week which showed a strong upwards revision to third-quarter economic growth and a sharp drop in jobless claims.Helping sentiment this morning is the weekend's news that export growth in China accelerated strongly in November. The year-on-year increase in exports accelerated to 12.7% last month, from 5.6% in October and well ahead of the 7% growth expected by analysts.Meanwhile, as import growth slowed down to 5.3% from 7.6%, the country's trade surplus widened to a five-year high of $33.8bn, from $31.1bn previously and ahead of forecasts.Figures also showed that Chinese consumer price inflation slowed to 3% in November, from 3.2% the month before and under the 3.1% rate forecast.Stocks to watchInsurance group Admiral has extended its underwriting arrangements with German peer Munich Re for its UK car insurance business. Munich Re underwrites 40% of the firm's UK car insurance business the new agreement extends this from the end of 2016 until at least the end of 2018. "The long-standing partnership allows Admiral to mitigate risk exposure while benefitting from profit commission," the firm said on Monday morning. Oil giant Tullow has plugged and abandoned the Tultule-1 wildcat well onshore Ethiopia after it failed to encounter oil. The well, in which Tullow owns a 50% interest along with partners Africa Oil (30%) and Marathon (20%), is located in the South Omo block and was targeting a reservoir section similar to the sands drilled in the nearby Sabisa-1 well where oil was found. While gas shows confirmed the presence of a hydrocarbon source in the region, Tultule-1 "will be plugged and abandoned as a dry hole" after reaching a total depth of 2,101 metres.Infrastructure giant Balfour Beatty said it has won a £121m joint venture contract to construct the new Defence College of Technical Training at the former RAF Lyneham airbase in Wiltshire for the Ministry of Defence (MOD). The 50:50 joint venture with Kier Construction will provide accommodation for military trainees and purpose-built training facilities for the Army's Corps of Royal Electrical and Mechanical Engineers, Balfour Beatty explained.BC