(Alliance News) – London stocks are set to open lower on Tuesday as investors await comments from Federal Reserve Chairman Jerome Powell and the first U.S. labor market data of the week.
The survey of job vacancies and labour mobility, due to be released at 3pm BST, could provide insight into the health of the US labour market ahead of official nonfarm payroll data on Friday and the front-loaded ADP employment report on Wednesday.
IG said futures suggested the FTSE 100 would open Tuesday down 21.6 points, or 0.3 percent, at 8,145.16. The London large cap index closed just 2.64 points higher at 8,166.76 on Monday.
In China on Tuesday, the Shanghai Composite Index rose 0.2% in afternoon trading, while Hong Kong's Hang Seng Index rose 0.4%. Tokyo's Nikkei rose 1.1% while Sydney's S&P/ASX 200 fell 0.2%.
“Attention now turns to Fed Chairman Powell's comments at the Sintra meeting later today and the release of the US JOLTS jobs data. Liquidity remains thin ahead of a US public holiday on Thursday and the release of key employment data on Friday, marking the start of the new quarter,” commented ActiveTrade analyst Anderson Alves.
The pound was trading at $1.2634 early Tuesday, down from $1.2639 at London's close on Monday. The euro rose to $1.0727 from $1.0723. The dollar rose against the yen to 161.64 yen from 161.58 yen.
Overnight in New York, the Dow Jones Industrial Average rose 0.1%, the S&P 500 rose 0.3% and the Nasdaq Composite Index surged 0.8%.
President Joe Biden warned on Monday that the US Supreme Court's landmark ruling on presidential immunity sets a “dangerous precedent” that Donald Trump will exploit if he wins the election in November.
The conservative-majority Supreme Court ruled that Trump and all presidents enjoy “absolute immunity” from criminal prosecution for “official acts” performed while in office, but that they can still be criminally punished for “unofficial acts.”
“In effect, today's decision means that there are almost certainly no limits to what a president can do. That's a fundamentally new principle and a dangerous precedent,” Biden said in a White House speech.
Trump faces criminal charges for trying to overturn his loss to Biden in the 2020 presidential election, but the trial was on hold while the Supreme Court considered Trump's request for immunity.
Monday's 6-3 ruling, split along ideological lines, will further delay the case and almost certainly postpone it until after Election Day in November.
The political situation in the UK will also be closely watched, with voting set to begin in around 48 hours.
British Chancellor Rishi Sunak said the election outcome was not a “foregone conclusion” and that the decisions of a small number of voters could undermine Labour's supermajority.
Opinion polls suggest that Labour is on track to win a large majority in Parliament after the election.
The Conservatives call this an unaccountable “super majority” and are trying to discourage voters who normally support them from switching to rival parties.
Speaking in Oxfordshire, the Prime Minister said: “The outcome of this election is not a foregone conclusion. If 130,000 people change their vote to support us we can stop Starmer winning a major majority.”
On the economic calendar on Tuesday, euro zone inflation figures will be released at 10am BST.
Antje Prefke, analyst at Commerzbank, commented on the upcoming data: “Today we will continue with the release of euro area inflation figures for June. The German data released yesterday were the first signs of some moderation, mainly due to energy prices. Our experts expect euro area headline interest rates to fall further to 2.5%, while core interest rates are likely to remain at 2.9%. Overall, today's data will confirm the ECB's expectations. Incidentally, the ECB expects a temporary increase in headline interest rates in the coming months, which will move inflation towards its 2% target over time, confirming market expectations for further rate cuts.”
Tuesday's UK corporate calendar will feature grocer Sainsbury's trading statement.
Brent crude was trading at $86.78 a barrel early Tuesday, up from Monday's closing price of $86.18 on the London Stock Exchange. Gold was trading at $2,328.34 an ounce, up slightly from $2,327.85.
Eric Cunha, news editor at Alliance News
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