London pre-open: Stocks expected to fall in aftermath of Fed minutes

22nd Aug 2013 07:35

Markets are expected to open firmly lower on Thursday morning in the aftermath of an underwhelming set of policy-meeting minutes from the Federal Reserve released last night.Wall Street's Dow Jones Industrial Average finished in the red for the sixth straight day - its worst losing streak since July 2012 - after the Federal Open Market Committee said at their July 30-31st meeting that they are "broadly comfortable" with the plan to taper stimulus by the end of the year, but didn't shed any light on an expected timeframe. Their outlook for the economy was bright, with the labour market having "improved substantially" and economic growth expected to "strengthen further" in the second half.Analyst Michael Gapen from Barclays said that the minutes didn't alter his outlook for a tapering of asset purchases to begin in September."The minutes were largely non-committal, offering little to suggest that the committee was ready to raise expectations further about tapering in September, while also saying little to indicate that participants did not think a September tapering would be appropriate," Gapen said.US benchmark 10-year Treasury yields rose on the back of the statement, rising to a fresh two-year high of 2.93% this morning - the highest since July 2011.City sources predict the FTSE 100 will open down around five points from yesterday's close of 6,390.84. Stocks to watch Kazakhmys reported a drop in half-year profits as copper producer was hit by lower metal prices and higher costs. The miner incurred a loss before tax from continuing operations of $193m for the six months to end of June, compared to a pre-tax profit of $307m.Newsagent chain WH Smith said it expects full-year results to be in line with market expectations as it continues focus on tight cost control and improving margins. In an update ahead of its results for the year ending August 31st due in October, the group said its Travel business continued a solid performance after it won new business in both the UK and international travel markets, it said. International engineering group IMI unveiled a 1% rise in adjusted pre-tax profit at £170.1m on flat revenue of £1,087m. The company continues to "anticipate better trading conditions in the remainder of the year", it said. BC