(Alliance News) - Stocks in London are set to open slightly higher on Monday, after better-than-expected UK GDP data on Friday created some optimism about the UK economy, with trading likely to be light due to a public holiday in the US.
IG says futures indicate the FTSE 100 index of large-caps to open up 3.73 points at 7,847.80 on Monday. The FTSE 100 index closed up 50.03 points, or 0.6%, at 7,844.07 on Friday.
London's flagship index is up 3.8% in the year-to-date so far. CMC Market's Michael Hewson said the catalyst for the turnaround in fortunes for the index appeared to be a combination of easing consumer prices, warmer weather, and better-than-expected trading statements from a host of companies, "after the widespread pessimism that characterised a lot of the narrative in the lead-up to Christmas".
The UK economy defied expectations and posted marginal growth in November, official figures on Friday had shown.
Gross domestic product was helped by the start of the football World Cup, which boosted consumer-facing sectors, the Office for National Statistics explained.
UK GDP grew by 0.1% month-on-month in November, slowing from October's unrevised growth of 0.5%. The economy had been expected to shrink by 0.2% in November, according to consensus cited by FXStreet.
Sterling was quoted at USD1.2268 early on Monday, higher than USD1.2209 at the London equities close on Friday.
After two months of falls, the average UK asking price rose by 0.9% in January, according to the latest data from Rightmove on Monday.
The average price of a property coming to the market for sale rose to GBP362,438 in January, up 0.9% from GBP359,137 in December. Rightmove said this was the biggest increase at this time of year since 2020.
Annually, the average asking price rose by 6.3% in January. In December, the annual rise was 5.6%.
Rightmove said that average asking prices are still GBP8,720 lower than their peak in October, however.
"After the market's uncertain final few months of 2022, this familiar seasonality is a tentative sign of stability...It's still early days, but this is a more encouraging start to the year than many anticipated," Rightmove said.
The euro traded at USD1.0859 early Monday, higher than USD1.0820 late Friday. Against the yen, the dollar was quoted at JPY127.45, down versus JPY127.85.
In Asia on Monday, the Japanese Nikkei 225 index was down 1.1%. In China, the Shanghai Composite was up 1.0%, while the Hang Seng index in Hong Kong was down 0.6%. The S&P/ASX 200 in Sydney closed up 0.8%.
China's economic growth for 2022 is expected to have been among its weakest in four decades after the twin crises of the pandemic and property woes, analysts said ahead of the release of official figures on Tuesday.
Ten experts interviewed by AFP forecast an average 2.7% year-on-year rise in gross domestic product for the world's second-largest economy, a sharp plunge from China's 2021 growth of more than 8%.
It could also be China's slowest pace since a 1.6 contraction in 1976 – the year Mao Zedong died – and excluding 2020, after the Covid-19 virus emerged in Wuhan in late 2019.
Beijing had set itself a growth target of around 5.5% for 2022 but this was undermined by the government's 'zero-Covid' policy, which put the brakes on manufacturing activity and consumption.
In the US on Friday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.3%, the S&P 500 up 0.4% and the Nasdaq Composite up 0.7%.
Financial markets in the US are closed on Monday for Martin Luther King day.
Gold was quoted at USD1,915.08 an ounce early on Monday, higher than USD1,911.40 on Friday. Brent oil was trading at USD84.56 a barrel, down from USD84.80.
In Monday's corporate calendar, there's a trading statement from FTSE 100 miner Rio Tinto, as well as from investment manager Ashmore.
By Heather Rydings, Alliance News senior economics reporter
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