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London open: Stocks dip as investors eye UK inflation figures
London stocks edged lower in early trade on Tuesday as investors awaited some key UK inflation figures.
At 0830 BST, the FTSE 100 was down 0.4% to 7,378.58, while the pound was flat against the euro at 1.1372 but 0.3% firmer versus the dollar at 1.3098 after the greenback was hit late on Monday as US President Trump’s healthcare bill failed to get congressional approval again.
Spreadex analyst Connor Campbell said: “The dollar doesn’t actually care about the healthcare bill specifically, but rather what it means for Trump’s ability to get anything done, something that could come to affect his infrastructure and tax plans down the road.”
The UK retail price index, producer price index and consumer price index are all due at 0930 BST.
Campbell said: “Analysts are expecting the CPI reading to have remained at 2.9% in June; however, the figure has outperformed estimates for the last four months in a row, suggesting we could get another surprise this morning.
“The Bank of England is so conflicted about what to do in regards to interest rates at the moment that a significant move in the inflation reading, be it up or down, could help push undecided MPC members in a hawkish or dovish direction ahead of the next meeting in early August.”
On the UK corporate front, British Land slipped lower as it announced a £300m buyback, saying opportunities investment in the company’s shares at the prevailing discount “offers better value than further asset acquisitions”.
Royal Mail was also a little weaker as it reported that continued strong sales from its European parcels operation in the first quarter offset a decline from its UK business.
Information services company Experian retreated as it said total revenue grew 5% at actual exchange rates in the first quarter, driven by 17% growth in Latin America, 8% in North America and 5% in the EMEA/Asia Pacific region. However, revenue for the UK and Ireland for the three months to 30 June dropped 13%.
Just Group slipped after it posted a 3% rise in new business sales for the six months to the end of June.
IG Group nudged up as it reported a 3% increase in full-year pre-tax profit, while Rio Tinto ticked higher despite cutting its full-year forecasts for iron ore shipments.
