City sources predict the FTSE 100 will open down eight points from yesterday's close of 5,777, after investor sentiment was dampened by a less that dazzling start to earnings season in America.

The largest US aluminium producer, Alcoa, cut its forecast for growth in global consumption of the metal by one percentage point, to 6%, due to a slowing in Chinese demand. This seems to have stoked renewed worries over the potential for economic weakness in the Asian giant, and prompted a sell off of resource stocks.

Also weighing the mood down is another credit ratings downgrade for troubled economy Spain.

Announcements out today include Bloomberg Consumer Confidence in the US, German CPI and the ECB Report.

In company news, Burberry, the luxury fashion chain which issued a profit warning last month, confirmed like-for-like (LFL) sales growth in its stores slowed dramatically in the July-September quarter. Total revenue in the six months to the end of September was up 8% year-on-year to £883m. Retail revenue was up by an underlying 10% over the half year period to £577m. LFL sales were up 3%, but much of the heavy lifting was done in the first quarter, when LFL sales were up 6%, while in the second quarter LFL sales growth eased to 1%.

Royal Bank of Scotland(RBS) said it priced Direct Line at 175p a share, valuing the insurance firm at over £2.6bn. The offer comprises 450m existing shares, representing 30 per cent of the 1.5bn total, raising RBS £787m. RBS had said it would float the firm at between 160p and 195p a share.

Assets under management at fund manager Ashmore picked up sharply in the July - September quarter, largely on the back of a positive investment performance. The quarter saw assets under management increase 6.8% to $68.0bn, driven by positive investment performance of $3.7bn and net inflows of $0.6bn. Investment performance was positive across all investment themes, it said.

Tempus in the Times writes that Diageo will hold its annual meeting next Wednesday and faces questions over two huge takeovers in growing economies. It is in talks to take a 25% stake in Indian company United Spirits as well as purchase the family-owned Jose Cuervo tequila brand from Mexico. Diageo's share price has risen 24% since the start of the year and sells on a 17 times earnings multiple. Still, "any further positive news, in not next week, could spark fresh impetus".

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Diageo (DGE) share price
Royal Bank of Scotland Group (RBS) share price
Burberry Group (BRBY) share price
Ashmore Group (ASHM) share price