London pre-open: Positive start expected despite sell-off in China

19th Jan 2015 07:39

UK stocks were expected to rise on Monday despite a massive sell-off on Chinese markets overnight after the government cracked down on margin-trading accounts.City sources predict the FTSE 100 will open 20 points higher than Friday's close of 6,550.27.Stocks in Shanghai plunged 8% on Monday with shares in the financial sectors faring the worst after securities regulators said many brokerage firms had broken stricter rules on margin trading.Margin finance involves the borrowing of money to buy stocks, something which the government is concerned will lead to instability. Record margin lending has resulted in a 63% surge in equity values over the past six months.A number of brokers, including Citic Securities and Hating Securities, were banned from opening new customer accounts for three months because of the violations.Stocks to watchPub operator and brewer Greene King said sales over the key Christmas period was "encouraging", though trading before and after the festive season was mixed. Chief executive Rooney Anand said: "Outside of those [Christmas] weeks, trading was more volatile, with the weeks before Christmas slightly down on the previous year and soft trading since the New Year."Infrastructure firm Balfour Beatty has been appointed sole contractor to a new £1.5bn framework that will run until February 2019. The national framework is operated by public sector-owned environment specialist Scape Group and hope to stimulate local jobs.Steel-maker Evraz saw its production of steel products rise by 6% in the last three months of 2014, driven by higher exports of export billets and slabs. That came on the back of the recent depreciation in the Russian rouble. Production of tubular products in North America increased by 6%. However, for all of fiscal year 2014 consolidated steel production and output of steel products, net of rolled volumes, decreased by 4% and 5%, respectively.