(Alliance News) - Stocks in London were set to open higher on Monday, recouping some of Friday's losses after further jitters in the banking sector.

IG says futures indicate the FTSE 100 to open up 53.3 points, 0.7%, at 7,458.75 on Monday. The large-cap index closed down 94.15 points, or 1.3%, at 7,405.45 on Friday but rose 1.0% for the week as a whole. It is down 2.0% in 2023 so far, however.

"As we look ahead to a new week as well as the end of the month and the end of the quarter, what was at one point set to be a positive start to 2023, could well turn out to be anything but, with all of the optimism of January and February, being replaced by concerns over financial and economic stability," said CMC Markets' Michael Hewson.

Banking stocks closed last week sharply lower, with Deutsche Bank bearing the brunt of the losses, falling 8.5% on Friday, as the price of its credit default swaps shot up. The stock is down 22% so far in 2023.

"So far, regulators and lawmakers have worked together to keep the crisis under control, and they have used all the help they could to do so. This particular element is keeping the hope alive that whatever the issue was with Deutsche Bank, lawmakers are going to address it, as there is simply too much to lose if things are left alone," said Naeem Aslam of Zaye Capital Markets.

The dollar was mixed against major currencies in early trade.

Sterling was quoted at USD1.2235 early Monday, up slightly from USD1.2222 at the London equities close on Friday. The euro traded at USD1.0768, higher than USD1.0753. Against the yen, the dollar was quoted at JPY130.83, up versus JPY130.69.

In UK company news, US activist investment firm Elliott Management is planning to take over beleaguered cinema chain Cineworld Group PLC's operations outside of the UK and the US, Sky News reported on Saturday.

Citing "insiders", Sky News said that Elliott has tabled a bid for the Brentford, London-based firm's operations in eastern Europe and Israel.

Elliott had explored a bid for the whole of Cineworld, but its most recent proposal excludes its UK and US operations, Sky said.

Stocks in New York ended higher on Friday, with the Dow Jones Industrial Average up 0.4%, the S&P 500 up 0.6% and the Nasdaq Composite up 0.3%.

The US will likely enter a recession this year and face high inflation well into 2024, a majority of economists predicted in their response to a semi-annual survey. More than two-thirds of respondents to the National Association for Business Economics Policy Survey also see inflation remaining above 4% at the end of this year.

In Asia on Monday, stocks were mixed. The Nikkei 225 index in Tokyo was up 0.5%. In China, the Shanghai Composite was down 0.7%, while the Hang Seng index in Hong Kong was down 0.7%. The S&P/ASX 200 in Sydney closed up 0.1%.

Gold was quoted at USD1,972.50 an ounce early Monday in London, lower than USD1,984.10 late on Friday. Brent oil was trading at USD75.12 a barrel, up from USD74.07.

Monday's economic calendar has the Ifo German business climate index at 0900 BST. Bank of England Governor Andrew Bailey speaks at 1800 BST.

Monday's corporate calendar has a trading statement from cruise ship operator Carnival and annual results from coal miner Thungela Resources and dining chain Tortilla Mexican Grill.

By Elizabeth Winter, Alliance News senior markets reporter

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