London pre-open: Small drop expected on FTSE ahead of jobs data

20th Feb 2013 07:30

City sources predict the FTSE 100 will open down four points from yesterday's close of 6,379, ahead of the release of today's UK jobs data and despite decent gains seen in the US overnight. The S&P 500 rose to a new five-year high on Tuesday, as confidence strengthened on hopes of further mergers and acquisitions. It is expected that a merger will take place between Office Depot and OfficeMax, following reports by the Wall Street Journal earlier this week. Meanwhile, Tuesday's session also saw President Barack Obama deliver a speech warning that people would lose their jobs if deep budget cuts proposed by Republicans were allowed to take effect on March 1st. He said that the $85bn (£55bn) of earmarked cuts was a harmful, "meat-cleaver approach" to tackling deficit reduction. Today's agenda is a packed one; UK announcements include BoE interest rate minutes, the claimant count rate, and the unemployment rate, while from abroad investors can expect the US FOMC interest rate minutes, US housing starts, the US producer price index, the German consumer price index, the Eurozone flash consumer confidence reading. In UK company news, BHP Billiton Chief Executive Marius Kloppers has stepped down as the company reported a 58 per cent fall in half-year profits due to weak commodity prices and a strong Australian dollar. Andrew Mackenzie will take over as boss after Kloppers retires from the group on October 1st. Industrial engineering group Weir has strengthened its presence in the fast-growing mining markets with three acquisitions worth a combined £55m. Weir said it has acquired the R Wales group of companies, a Canada-based manufacturer of wear resistant linings for the mining, minerals processing and oil sands industries.Building materials group Travis Perkins boosted annual revenue and profit, despite continued headwinds in construction markets, and underlined its confidence in future trading by lifting its dividend payment by a quarter. Pre-tax profit rose 16.2% to £313.3m for the year ended December 31st 2012, while group revenue climbed 1.4% to £4.84bn during the period. On a like-for-like basis revenue was down 1.4%.