London pre-open: Stocks seen higher despite Capitol Hill chaos

by | Jan 8, 2021

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(Sharecast News) – London stocks were set for more gains on Thursday despite the chaos on Capital Hill overnight.
The FTSE 100 was called to open 47 points higher at 6,888.

Naeem Aslam, chief market analyst at Ava Trade, said: “Traders are unfazed by the chaos that we experienced on Capitol Hill yesterday as stock futures are set to build more gains today. This is mainly because investors are optimistic about the possibility of more stimulus from Democrats.

“Basically, this is the first time in 10 years where Democrats will control the House, Senate, and the White House. This means a strong possibility of bills getting passed by lawmakers. However, it is important to keep in mind that the chaos which we saw yesterday has halted the Electoral vote count, and now, we may have to wait for days before we see the final resolution. Although the outcome is going to be the same, which is the Blue Wave, and traders are very positioned for this.”

 
 

In corporate news, UK supermarket chain Sainsbury’s reported a 9.3% rise in like-for-like sales over the festive period as Britons treated themselves to champagne and steaks in response to restrictions on the size of gatherings.

Like-for-like sales excluding fuel for the third quarter to January 2 rose 8.6% with total retail sales up 6.8%. Sainsbury’s said it now expected to report underlying profit before tax of at least £330m in the year to March 2021 compared with £586m a year ago after forgoing business rates relief of £410m.

B&M European Value Retail said revenue increased 22.5% to £1.4bn in the third quarter on a constant currency basis and it would pay a special dividend of 20p a share.

 
 

Performance in the 13 weeks to 26 December was driven by 21.1% like-for-like growth in the UK. B&M said annual adjusted earnings would be between £540m and £570m after it decided to pay £80m of business rates.

TP Icap updated the market on the year ended 31 December, reporting that while trading volumes were still subdued during the fourth quarter, it expected revenue for the full year to be 1% lower than the prior year.

The company put that performance down to its diversification strategy, as revenue growth achieved in its data and analytics, institutional services, and energy and commodities divisions offset much of the decline in revenue in its global broking division in 2020, after a strong first quarter.

 
 

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