London pre-open: Russia and China concerns to weigh FTSE down

24th Mar 2014 07:23

UK stocks are set to be weighed down by the building geopolital tensions in western Europe and as the latest data out of China disappointed yet again.City sources predict the FTSE 100 will open around 40 points lower than Friday's close of 6,557.1.Data revealed the flash Markit/HSBC Purchasing Managers' Index (PMI) for China registered a contraction in the first quarter of this year, falling from 48.5 in February to 48.1 this month.Capital Economics said of the data: "Today's PMI reading suggests that conditions in the manufacturing sector have continued to deteriorate [... it was] much weaker than most expected (the Bloomberg median was 48.7; our forecast was 48.5)."It added: "The weakness appears even more pronounced given that there is usually a seasonal rebound after the Chinese New Year holiday."Meanwhile, Nato has warned that Russian army units have built up a concentration near the Ukraine's border, and is reportedly concerned about the threat this poses to Moldova's Trans-Dniester region. Russia has insisted it is operating in compliance with the agreements made at the international level. Speaking to the BBC, Ukrainian Foreign Minister Andriy Deshchytsia said the risk of war with Russia was increasing. He explained that Russian President Vladimir Putin is opposed to talking to both Ukrainian and Western powers, which poses "quite a danger for the decision-making process". "We could only expect that he might invade," he added. In today's company news, WPP has agreed to acquire a majority stake in Cognifide, a UK digital technology consultancy which specialises in content management and digital asset management technology. The firm, which employs more than 200 people, will continue to operate as its own brand within WPP.Life insurance and pension group Standard Life has confirmed weekend media speculation that it is in advanced talks to buy rival Phoenix Group Holdings' Ignis Asset Management. Anglo American's Group Director of Human Resources and Corporate Affairs has decided to step down. Mervyn Walker will retire on June 30th after six years in the role. Technical products and services provider Diploma said revenues for the half year, on an underlying basis, is expected to increase by 7% from the year earlier after progress across all businesses. The largest contribution to revenue growth was from Controls, with trading up sharply in both the UK and Germany. Revenues are now expected to increase by 10% on an underlying basis.NR