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Highlights:
- FTSE 100 set for a positive open: London markets are expected to open higher, tracking gains from Wall Street and ahead of key US inflation data.
- Cranswick expects results at the higher end: Strong first-half performance drives confidence, but the company remains cautious due to external uncertainties.
- PureTech Health secures milestone payment: US approval for its schizophrenia treatment triggers a significant payout and potential future royalties
London markets are poised for a positive start on Friday, following gains on Wall Street and ahead of the release of the US Federal Reserve’s preferred inflation measure. The FTSE 100 is anticipated to open about 10 points higher as investors closely monitor economic indicators that could influence the Fed’s monetary policy outlook.
Ipek Ozkardeskaya, senior analyst at Swissquote Bank, commented on the expectations for the US core Personal Consumption Expenditures (PCE) index for August. She noted that the index is projected to remain steady at 0.2% on a monthly basis, while showing a slight increase from 2.6% to 2.7% year-on-year. In addition, personal income is expected to have risen at a faster pace, while personal spending likely grew more slowly compared to the previous month.
Ozkardeskaya added that a set of data in line with forecasts would support the current “soft-landing” scenario and sustain optimism for another potential record high for the S&P 500. However, a stronger-than-anticipated PCE reading could challenge the market’s dovish outlook on the Fed and potentially trigger a correction. Recent robust GDP data has slightly reduced the chances of a 50 basis-point rate cut at the Fed’s November meeting, though the probability remains close to a coin toss.
Corporate News
In company updates, Cranswick Plc (LSE:CWK) announced it anticipates its full-year results to be at the higher end of market expectations, following a strong first half of trading. The food producer, which specializes in fresh pork and poultry, said its performance was underpinned by robust volume growth in its core UK food business and a positive contribution from its expanding pig farming operations. Despite this, Cranswick maintained a cautious outlook due to broader market, economic, and geopolitical uncertainties.
Market forecasts for Cranswick’s adjusted pre-tax profit range between £179.2 million and £191.7 million for the year ending September 2024.
Meanwhile, PureTech Health (LSE:PRTC), a clinical-stage biotherapeutics firm, announced that the schizophrenia treatment it developed and later sold to Bristol Myers Squibb has received regulatory approval in the United States. This milestone has triggered a payment of €29 million to PureTech and unlocked the potential for future royalty payments.
