(Alliance News) - Stocks in London are set to open higher on Thursday, as investors look ahead to the latest interest rate decision from the European Central Bank.
IG says futures indicate the FTSE 100 to open 16.8 points, 0.2%, at 7,553.07 on Thursday. The index of London large-caps closed down just 1.54 points at 7,536.27 on Wednesday
There was some bad news for UK housebuilders, as house prices declined at their fastest rate since 2009 in August, according to surveyors. The Royal Institution of Chartered Surveyors said a net balance of 68% of property professionals reported house prices falling rather than rising, marking the most negative reading since 2009.
Further, controversial government plans to relax environmental rules to boost housebuilding have been scuppered by peers. The House of Lords voted by 192 to 161, majority 31, against scrapping EU-era rules that force developers to mitigate the impact new homes have on river health.
In Asia on Thursday, the Nikkei 225 index in Tokyo was down 0.2%. In China, the Shanghai Composite was marginally higher, while the Hang Seng index in Hong Kong was up 0.2%. The S&P/ASX 200 in Sydney was up 0.6%.
Markets were fairly sanguine, despite Wednesday's hotter-than-expected US inflation print.
In the US on Wednesday, Wall Street ended mixed, with the Dow Jones Industrial Average down 0.2%, the S&P 500 up 0.1% and the Nasdaq Composite up 0.3%.
The consumer price index increased to 3.7% on an annual basis in August, from a 3.2% rise in July. The headline inflation figure was expected to accelerate to 3.6%, according to FXStreet-cited market consensus. Core inflation cooled annually, but edged up by slightly higher than expected from the prior month.
SPI Asset Management's Stephen Innes said the cooling of annual core inflation and the recent cooling labour market data will "likely seal the deal" for a rate pause from the Federal Reserve next week.
"Nevertheless, given the disconcerting uptick in headline inflation and the ongoing ascent of oil prices, the Federal Reserve is likely to maintain the option of another rate hike should the trend of inflation moderation witnessed over the summer fail to persist," he added.
The dollar was weaker in early transactions in Europe.
Sterling was quoted at USD1.2505 early Thursday, higher than USD1.2496 at the London equities close on Wednesday. Against the yen, the dollar was quoted at JPY147.10, down versus JPY147.42.
It's the ECB's turn to announce its latest interest rate decision at 1315 BST, with many forecasters predicting a final 25 basis point hike. However, some predict the Frankfurt-based central bank might opt to keep rates on hold.
The euro traded at USD1.075, gaining ground on USD1.0744.
Gold was quoted at USD1,909.75 an ounce early Thursday, lower than USD1,912.70 on Wednesday. Brent oil was trading at USD92.37 a barrel, up from USD92.15.
In Thursday's UK corporate calendar, there are full-year results from MJ Gleeson, Renishaw and Kier Group. There will also be half-year results THG and trading statements from Trainline and IG Group.
The economic calendar has the US weekly unemployment claims report at 1330 BST alongside US retail sales data and the latest US producer price index print.
By Elizabeth Winter, Alliance News senior markets reporter
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