London pre-open: Stocks seen rising as Chinese growth picks up

16th Jul 2014 07:53

UK stocks are expected to open with small gains on Wednesday after economic growth in China came in ahead of forecasts.City sources predict the FTSE 100 will open around 19 points higher than Tuesday's close of 6,710.45.Chinese gross domestic product (GDP) grew at an annual rate of 7.5% in the second quarter of 2014, surprising analysts who had expected growth to remain unchanged from 7.4% in the first quarter.Other data from China also showed that fixed asset investment and industrial production both came in above analysts' estimates in June, while retail sales growth of 12.1% was unchanged, slightly lower than expected."The release of Chinese growth, industrial production and fixed asset investment all gave us a pleasant surprise, showing that the slowdown within China was largely overstated and gives me greater confidence that within H2, the Asian powerhouse will be able to really kick on," said Market Analyst Joshua Mahony from Alpari UK."However, we did not see the major market moves [in Asia] that would be expected and this is likely to be down to the fact that growth still remains relatively weak despite the rise from 7.4% to 7.5%," he said.Looking ahead to the rest of the day, unemployment figures are due out in the UK, while industrial production data will be released in the States later on.In company news this morning, postal group Royal Mail said it is facing a potentially "material" impact from a competition investigation in France. Royal Mail said some of its group companies had received a notice from the French competition authority alleging breaches of antitrust laws by one of its subsidiaries, GLS France.Mike Ashley, the billionaire founder and retail tycoon who founded Sports Direct, has told the board of the sportswear chain that he will withdraw his name from its controversial bonus scheme.Mining giant Rio Tinto said it delivered a "very strong first half" with productivity gains across the business. The iron ore business, which accounted for around half of group revenues in 2013, registered record shipments, production and rail volumes in the six months to June 30th. British Land reported a good start to the year as it continues to make the most of strong markets, with the occupational and investment markets in London and retail both strengthening. Imperial Tobacco is likely to be trading lower this morning as it goes ex-dividend.BC