- Markets turn to US non-farm payrolls
- ECB 'ready and willing to act'
- China services PMI weakens in January
UK stocks are expected to open higher on Friday morning despite yet more disappointing economic data from China, as investors show optimism ahead of the all-important US employment report.
Even after a strong surge on Thursday which saw the FTSE 100 jump 1.55%, city sources predict the index will open around 19 points higher than the previous close of 6,558.28.
Stocks were also helped yesterday after comments from European Central Bank (ECB) President Mario Draghi who said that policymakers stand "ready and willing to act".
The ECB kept interest rates unchanged despite mounting pressure to take greater measures to tackle a recent slowdown in price rises, with Draghi once again playing down concerns over deflation. Nevertheless, he said that policymakers are awaiting more data to be released in March before deciding whether to take further action.
Meanwhile, US markets rose strongly last night after some better-than-expected jobless claims data with the Dow Jones Industrial Average and S&P 500
registering their best gains in seven weeks.
As for today, investors will be awaiting the US Labor Department's official non-farm payroll data due out this afternoon, which is expected to show that non-farm payrolls rose to 184,000 in January from just 74,000 in December.
In China overnight, it was revealed that the HSBC/Markit service-sector purchasing managers' index (PMI) fell from 50.9 to 50.7 in January. While still showing an expansion - reflected in any number above 50 - the slight fall represents a slowdown in growth to the lowest level in two and a half years.
Stocks to watch
Shire has announced it will no longer pursue the development of Vyvanse following a clinical trial of the drug for the treatment of major depressive disorder. The company said top-line results from two pivotal Phase 3 investigational studies evaluating the efficacy and safety of Vyvanse showed it failed to meet objectives.
Property group British Land has upped its holding in Hercules Unit Trust (HUT), a retail park property unit trust, by more than previously expected. British Land said it has received its allocation of units in HUT and has agreed to buy £66.8m of units at £613 per unit, representing a price 3.8% below the latest estimate of net asset value. The acquisition, which British Land assured will be accretive to earnings, will increase its share in HUT to 57.2%, from the current level of 49.2%.
Private equity-focused investment trust Electra Private Equity said it saw a continuation of high investment activity over its first quarter as net asset value (NAV) edged higher. The diluted NAV per share rose to 2,781p by December 31st, up from 2,764p at the end of the previous financial year on September 30th. The prior year saw record levels of both new investments and realisations.