London pre-open: Stocks seen flat after fresh record; Powell speech eyed

22nd Aug 2025 07:31

(Sharecast News) - London stocks were set for a steady open on Friday after closing at a fresh record a day earlier for the third day in a row, above 9,300.

The FTSE 100 was called to open flat at 9,309, with all eyes on an upcoming speech by Federal Reserve chair Jerome Powell at Jackson Hole.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: "While he may stick to a 'data dependent' message, the venue has historically hosted major policy shifts. Markets are alert to any surprise, and there is a greater chance that we will see a hawkish surprise than the contrary.

"A cautiously hawkish tone from Powell could further unwind the market's extra-dovish positioning. That could mean a rebound in US 2-year yields, pressure on the S&P 500, a stalling of the small-cap rally, and renewed strength in the US dollar.

"Rising global yields - notably in long-maturity JGBs - add to the risk of a broader selloff if Powell strikes a firmer line."

On home shores, a survey out earlier showed that improved confidence about personal finances pushed consumer sentiment higher in August, though concerns about rising inflation and unemployment continued to dampen the overall mood.

The GfK consumer confidence index rose by two points to -17 this month, its highest level this year, with four of the five components of the gauge improving from July.

Notably, sentiment gauges around consumers' personal financial situation over the past 12 months and expectations for the coming year both rose by three points to -4 and +5, respectively.

GfK said the brighter outlook was most likely due to the Bank of England cutting interest rates to a two-year low earlier this month.

However, Neil Bellamy, consumer insights director at GfK, said there were still "many clouds on the horizon in the form of inflation - the highest since January 2024 - and rising unemployment. There's no shortage of speculation, too, about what the autumn Budget will bring in terms of tax rises."

Bellamy added: "While August's Overall Index Score of -17 is the best this year, consumer confidence continues to move in a very narrow band, and there's no sense that it is about to break out into fresher, more optimistic territory. The UK's consumers are still in wait-and-see mode, and any surprises could result in sudden and sharp changes in sentiment."

In corporate news, Blackstone emerged as the winner in the race to buy Warehouse Reit, after rival bidder Tritax Big Box Reit said it would not increase its offer for the commercial landlord.

Warehouse last month changed its endorsement after Blackstone confirmed it would allow shareholders to receive a dividend from Warehouse as part of its £489m bid.

Tritax had offered a cash and stock deal worth around £485.2m, but on Friday said it did not believe that increasing the financial terms would be in the interests of its shareholders.