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On Thursday, London stocks are anticipated to decline at the start of trading, following mostly weaker performances in the US and Asian markets. The FTSE 100 is projected to open approximately 16 points lower.
Market Focus
Ipek Ozkardeskaya, a senior analyst at Swissquote Bank, highlighted the significance of the upcoming ADP report. Analysts on Bloomberg forecast that the US economy may have added around 144,000 private jobs last month, up from 122,000 the previous month. A report aligning with these expectations or exceeding them could alleviate recession concerns and stabilize indices leading into Friday’s official jobs report. Conversely, a weaker-than-anticipated figure might exacerbate recession fears and could negatively impact US Treasury yields, the dollar, and stock indices.
Other key items on the agenda include the ISM services index, weekly crude oil inventories, and earnings from Broadcom (LSE:0YXG). Broadcom’s Q2 results, expected to be announced after market close, are anticipated to reflect strong performance driven by increased demand for AI, a rebound in networking equipment services, and VMware’s transition to a subscription-based sales model, which is believed to have positively influenced revenue.
Corporate News
In UK corporate news, Primark’s parent company, Associated British Foods (LSE:ABF), has indicated a projected decline in like-for-like sales of approximately 0.5% for the second half of the financial year. The fourth quarter is expected to see a 0.9% drop, attributed to poor weather conditions in the UK and Ireland affecting foot traffic and seasonal sales in women’s fashion and footwear. Despite these challenges, Primark’s revenue growth for the period is forecasted to reach around 4%, supported by ongoing store expansion. The company also announced an extension of its share repurchase program by an additional £100 million, following robust cash generation this year.
Additionally, housebuilder Vistry (LSE:VTY) has revealed plans for a new £130 million share buyback, following a 7% increase in first-half pre-tax profit. For the six months ending June 30, pre-tax profit rose to £186.2 million from £174 million in the same period the previous year. Total home completions increased by 9.1% to 7,792 units, with Vistry noting strong demand in its Partner Funded markets.
