FTSE 100 to open lower as election heats up

May 28, 2024 at 01:58 am EDT

(Alliance News) - Stocks in London are set to open lower on Tuesday, ahead of a slew of data from the US this afternoon, and as the UK general election campaign gets underway.

IG says futures indicate the FTSE 100 to open 0.1% lower on Tuesday. The index of London large-caps closed 0.3% lower on Friday.

Rishi Sunak is gambling on a GBP2.4 billion tax break to help secure the support of pensioners as he battles to remain in office. The prime minister promised to increase the income tax personal allowance for pensioners, giving them a tax cut worth around GBP95 in 2025 to 2026, rising to GBP275 in 2029 to 2030.

By contrast, Labour said it was a "desperate move" from a party which was "torching" what was left of its claims to economic credibility.

Sterling was quoted at USD1.2776 early on Tuesday, higher than USD1.2748 at the London equities close on Friday.

According to recent data from the British Retail Consortium, shop price inflation in the UK eased to 0.6% annually in May from 0.8% in April, as all categories showed weaker price pressure.

Food price inflation, meanwhile, slowed to 3.2% this month from 3.4% in April. Fresh food prices were up by 2.0% on a year before in May, slowing from 2.4% in April.

The euro traded at USD1.0875 early on Tuesday, higher than USD1.0849 late Friday. Against the yen, the dollar was quoted at JPY156.78, down versus JPY156.96.

In the US on Friday, Wall Street ended higher, with the Dow Jones Industrial Average just fractionally in the green, the S&P 500 up 0.7% and the Nasdaq Composite up 1.1%.

According to the Census Bureau, durable goods orders climbed 0.7% in April from March, defying the FXStreet cited forecast of a 0.8% slide. In March, orders rose 0.8% from February.

Year-ahead inflation expectations edged up from 3.2% last month to 3.3% this month, but long-run inflation expectations held steady at 3.0% for the second straight month.

US economic data last week was red-hot, strengthening the case for the Fed to keep rates higher for longer.

In Asia on Tuesday, the Nikkei 225 index in Tokyo was down 0.2%. In China, the Shanghai Composite was down 0.1%, while the Hang Seng index in Hong Kong was up 0.1%. The S&P/ASX 200 in Sydney closed down 0.2%.

Australian retail sales edged up on a monthly basis in April, official data showed. The Australian Bureau of Statistics said retail sales rose 0.1% in April from March, underperforming FXStreet-cited consensus of a 0.2% rise. They had fallen by 0.4% in March from February.

Gold was quoted at USD2,351.60 an ounce early on Tuesday, higher than USD2,336.80 on Friday.

Brent oil was trading at USD82.99 a barrel early on Tuesday, higher than USD81.54 late Friday.

On Tuesday's corporate calendar, there are full-year results from Xeros, the laundry tech firm, and TheraCryf, the drug development company. Half-year results are due from Victorian Plumbing, and first quarter results from Princess Private Equity.

Meanwhile, the economic calendar has wholesale prices from Germany at 0700 BST, followed by a slew of data from the US later in the afternoon. This includes the house price index at 1400 BST, and consumer confidence at 1500 BST.

By Holly Beveridge, Alliance News reporter

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