(Alliance News) - Stocks in London were set to open marginally lower on Wednesday ahead of the UK consumer price index for January, which is expected to show that inflation remained in double-digits.
IG says futures indicate the FTSE 100 index of large-caps to open down just 3.05 points at 7,953.85 on Wednesday. The FTSE 100 index closed up 6.25 points, or 0.1%, at 7,953.85 on Tuesday and set a new all-time high of 7,996.35 earlier in the day.
In December, inflation in the UK was 10.5%. Markets are expecting the rate to cool slightly to 10.3% on Wednesday.
Michael Hewson at CMC Markets said: "Unlike the US and Europe, headline CPI in the UK is proving be a lot stickier having fallen only modestly from its October peaks of 11.1%, with today's January CPI number expected to see a fall to 10.3%. This seems fairly modest when compared to the bigger slowdowns we've seen in both the US and Europe, where headline inflation is much lower."
The pound softened ahead of the data release. Sterling was quoted at USD1.2139 early Wednesday, lower than USD1.2174 at the London equities close on Tuesday.
The euro traded at USD1.0706 early Wednesday, lower than USD1.0731 late Tuesday. Against the yen, the dollar was quoted at JPY133.20, higher versus JPY132.79.
In the US on Tuesday, Wall Street ended mixed, with the Dow Jones Industrial Average ending down 0.5% and the S&P 500 marginally lower, but the Nasdaq Composite rising 0.6%.
US consumer price inflation slowed in January, according to the latest data from the US Bureau of Labor Statistics on Tuesday, though not by as much as expected.
The consumer price index rose 0.5% on a monthly basis in January, slowing from a 0.1% increase in December.
Annually, consumer price inflation stood at 6.4%, easing slightly from 6.5% in December. The figure came above market consensus, as cited by FXStreet, which expected inflation to slow to 6.2%.
In Asia on Wednesday, the Nikkei 225 index was down 0.4%. In China, the Shanghai Composite also was down 0.4%, while the Hang Seng index in Hong Kong was down 1.5%. The S&P/ASX 200 in Sydney closed down 1.1%.
Fresh analysis of unidentified aerial objects that flew over Japan's airspace in recent years "strongly" suggests they were Chinese spy balloons, according to Tokyo's defence ministry.
Japan said last week it was re-analysing a series of incidents involving unidentified aerial objects in light of a Chinese spy balloon shot down by the US after crossing US territory.
Brent oil was trading at USD84.65 a barrel early on Wednesday, lower than USD85.67 late Tuesday. Gold was quoted at USD1,843.24 an ounce, down from USD1,852.49.
In Wednesday's corporate calendar, there are full-year results from lender Barclays and miner Glencore as well as half-year results from retailer Dunelm and retail investment platform Hargreaves Lansdown.
Other then the UK inflation reading, the economic calendar on Wednesday has EU trade data at 1000 GMT.
By Heather Rydings, Alliance News senior economics reporter
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