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London pre-open: Stocks seen higher as investors eye inflation data
London stocks were set for a firmer open on Tuesday following losses in the previous session, as investors eyed key readings on inflation.
The FTSE 100 was called to open 32 points higher at 7,075.
Meanwhile, sterling was steady, having rallied on Monday on news that the UK and the EU had agreed the terms of a Brexit transition period.
On the economic calendar, the retail price index, producer price index and consumer price index are all due at 0930 GMT.
CMC Markets analyst Michael Hewson said: "Today's latest inflation data could well offer some welcome respite to the UK consumer, given recent concerns over the stickiness of current levels of inflation. Headline CPI has been stuck around 3% for several months now, frustrating central bank predictions of a possible peak in price pressures.
"The recent recovery in the pound over the last 12 months doesn't appear to be helping in this regard, though there is some hope that we could finally start to see some downward pressure start to manifest itself by now. Inflation in the EU and the US does appear to be slipping back a little, as shown by figures last week, and the expectation for today is that UK CPI for February will do likewise and slip back to 2.8%,with core CPI also softening from 2.7% to 2.5%.
"This would be even more welcome if tomorrow's wages data edges up from last month's 2.5%.which it is expected to do."
In corporate news, housebuilder Bellway said it was on track to build more than 10,000 homes in a year for the first time as half year pre-tax profits rose 16.6% to £288.7m.
Volume growth of 6.3% to 4,741 homes, together with average selling price growth of 7.7% to £275,945 drove an increase in operating profit to £294.2m from £252.6m.
The interim dividend was lifted 28% to 48p a share.
One of the most intense games of corporate ping-pong continued apace on Tuesday, with GKN issuing a response to Melrose's latest allegations on the future state of GKN's UK pension schemes. The FTSE 100 firm's board was still trying to fight off a hostile takeover bid from Melrose, with the deadline for shareholders looming.
It said Melrose's comments were misleading as to the true status of its pension obligations after the proposed combination of its Driveline business with Dana, saying that as part of the transaction, GKN will transfer £1.375bn of gross pension and post-retirement medical scheme liabilities, and £818m of pre-tax deficit.
Ocado's first quarter saw revenues fall from the preceding quarter but improve compared to the start of last year as heavy snow across Britain disrupted the final week.
Retail revenue of £363m in the 12 weeks to 4 March was up almost 12% year-on-year but down nearly 3% quarter on quarter.
French tyre manufacturer Michelin has agreed to buy UK engineering company Fenner in a deal worth around £1.3bn.
Under the terms of the transaction, Fenner shareholders will receive 610p in cash per share, which is a premium of around 31% to the closing price of 467p on 16 March.