London pre-open: Stocks to move lower after drop in Asian markets

4th Nov 2014 07:17

UK indices are expected to track declines seen in Asia overnight thanks to weakened Chinese manufacturing data out over the weekend.City sources predict the FTSE 100 will open around 17 points lower than yesterday's close of 6,487.97."Asian shares were mainly trading negatively throughout the night as sentiment was slightly dampened by weaker-than-expected manufacturing data however the Nikkei continued to surge, breaking through seven-year highs as the decision by the Bank of Japan to increase the level in which they will buy Japanese government bonds shocked markets," said Speadex's Samuel Fox.There were also fluctuations on US stock markets on Monday as energy companies dropped with the price of oil after Saudi Arabia said it will cut prices of crude sent to the US.Tuesday's session will see the release of Spanish unemployment figures, which are predicted to reveal a rise of 23,400 in October.Back in the UK, construction purchasing managers' index is expected to reveal a modest slowdown to 63.7, after September's unexpected rise to 64.2.Chief market analyst at CMC Markets Michael Hewson said: "After the strong gains seen in equity markets at the end of last week it was probably inevitable that we got a little bit of a pullback yesterday."He said that Monday's losses "don't appear that much to worry about, despite some disappointing economic data from some of the economies around Europe, though the continued weakness in US oil prices could well weigh on the energy sector this morning".In company news, cigarette maker Imperial Tobacco hailed rising demand for key brands such as Davidoff, JPS and Lambert & Butler and said it was boosting its annual dividend by 10% to 128.1p a share. However, the group said full-year adjusted operating profits were flat on a constant currency basis and fell 5% in actual terms to £3.03bn.Full-year earnings from Associated British Foods were up 6% on the prior year as the company predicted a slight increase in earnings in the new financial year due to dwindling sugar profits. Revenues in the 52 weeks to 13 September fell 3% to £12.9bn in actual terms, but rose 1% at constant currencies, with adjusted pre-tax profits up 2% to £1.12bn despite pressure from lower sugar prices in the EU.Anglo-Swiss commodities giant Glencore saw an 8% increase in copper production in the first three quarters of 2014, but reported mixed output from its other operations. The company said own-sourced copper output totalled 1.15m tonnes in the nine months to 30 September, up from 81,900 tonnes on the comparable period the year before.