(Alliance News) - London's FTSE 100 is called to open sharply lower on Friday, with hawkish comments from US monetary policymakers and geopolitical tensions keeping a lid on enthusiasm.

IG says futures indicate the FTSE 100 to open 97.7 points lower, 1.2%, at 7,878.19 on Friday. The index of London large-caps closed up 38.45 points, 0.5%, at 7,975.89 on Thursday.

In Asia, the Nikkei 225 in Tokyo lost 2.1%, while the Hang Seng Index in Hong Kong was down 0.1%. Financial markets in Shanghai were closed. In Sydney, the S&P/ASX 200 fell 0.6%.

In New York overnight, both the Dow Jones Industrial Average and the Nasdaq Composite tumbled 1.4%, while the S&P 500 shed 1.2%.

Confidence in three rate cuts from the Federal Reserve this year, beginning in June, is being tested by a string of recent data indicating the US economy remains in rude health, while bank officials have done little to soothe concerns.

Minneapolis Fed chief Neel Kashkari said Thursday that there was a chance of no reductions this year, calling inflation figures in January and February "a little bit concerning" and adding that he wanted to see more positive data.

His Philadelphia counterpart Patrick Harker warned prices were still rising too sharply and that "we're not where we need to be", while Richmond boss Thomas Barkin called it "smart" to take time to get a clearer idea about the path for inflation.

Eyes now turn to Friday's nonfarm payrolls reading, at 1330 BST, which is expected to show the pace of jobs growth eased to 200,000 in March, from 275,000 in February, according to FXStreet.

Numbers on Wednesday from payroll processor ADP showed the US private sector added more jobs in March than a month earlier.

Private sector employment increased by 184,000 jobs in March, rising from 155,000 in February. March's jobs growth topped the FXStreet cited consensus of 148,000.

The pound was quoted at USD1.2624 early Friday in London, down from USD1.2667 late Thursday. The euro fell to USD1.0826 from USD1.0865. Against the yen, the dollar fell to JPY151.16 from JPY151.67.

Comments from Bank of Japan's governor, Kazuo Ueda, provided some strength for the yen.

According to Reuters, Ueda signalled that the BoJ could "respond with monetary" policy if currency moves appear to be having a significant impact on inflation and wages.

He also predicted that inflation would accelerate from "summer toward autumn" following the latest pay negotiations. The comments helped to boost the yen, and increased expectations for a potential upcoming rate hike from the BoJ.

A barrel of Brent oil fetched USD91.06 early Friday, up from USD89.13 at the London equities close on Thursday.

Israeli Prime Minister Benjamin Netanyahu has threatened consequences in the event of an Iranian attack on his country.

"Iran has been acting against us for years, both directly and through its proxies; that is why Israel is taking action against Iran and its proxies, defensively and offensively," Netanyahu said at the start of a meeting of the Israeli security cabinet on Thursday evening, his office announced.

"We will know how to defend ourselves and we will act according to the simple principle: Whoever harms us or plans to harm us, we will harm them," Netanyahu said.

The Israeli government and its ally the US are concerned that Iran is preparing for an imminent attack, the news portal Axios quoted US and Israeli officials as saying.

Gold was quoted at USD2,281.83 an ounce early Friday, down from USD2,292.67 late Thursday.

Before the US jobs report, Friday's economic calendar has a UK Halifax house price index reading at 0700 BST, before a construction purchasing managers' index reading at 0930 BST.

By Eric Cunha, Alliance News news editor

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