LONDON MARKET EARLY CALL: Stocks called up after positive NY close

(Alliance News) - Stocks in London are set to open higher on Wednesday, after US equities snapped their losing streak. IG says futures indicate the FTSE 100 index of large-caps to open up 30.2 points, 0.4%, at 7,400.82 on Wednesday. The FTSE 100 index closed up 9.31 points, or 0.1%, at 7,370.62 on Tuesday.

"European markets underwent a choppy session yesterday, initially opening sharply lower in the wake of the Bank of Japan's decision to relax its yield curve control criteria, before closing well off the lows of the day," CMC Markets analyst Michael Hewson said. Wall Street ended higher on Tuesday, with the Dow Jones Industrial Average up 0.3%, the S&P 500 up 0.1% and the Nasdaq Composite marginally higher. "After four days of losses US markets just about managed to break their losing streak, with the focus this week very much on Friday's Personal Consumption Expenditures report and US consumer spending reports for November, which has thus far held up reasonably well this year, despite declining consumer confidence," said Hewson.

In a positive sign for consumer confidence, Nike reported strong revenue growth in its second quarter late Tuesday, sending its shares up 13% in after-hours trade in New York. In the three months ended November 30, revenue rose 17% against the previous year, climbing to USD13.32 billion from USD11.36 billion. However, cost of sales jumped 24% to USD7.60 billion from USD6.14 billion.

The footwear maker reported net income of USD1.33 billion, down 0.4% from USD1.34 billion the previous year. Basic earnings per share in the quarter edged up USD0.85 from USD0.84. "Nike was able to clear most of its hefty inventory, which was a concern for many traders given the fact that we are going through a time where the cost of living crisis is a major factor," said Naeem Aslam, chief market analyst at Avatrade.

In Asia on Wednesday, the Nikkei 225 index in Tokyo closed down 0.7%, extending Tuesday's losses after the shock move from the Bank of Japan to widen the range for 10-year government bond yields. Against the yen, the dollar was quoted at JPY132.12 early Wednesday, up versus JPY131.27 at the London equities close on Tuesday. The dollar was mixed elsewhere, with sterling was quoted at USD1.2159, higher than USD1.2139.

The euro traded at USD1.0612, edging lower from USD1.0627. In China, the Shanghai Composite was down 0.3%, while the Hang Seng index in Hong Kong was up 0.3%. The S&P/ASX 200 in Sydney closed up 1.3%.

"Equities are trading mixed, and despite all the recession headlines and sovereign yield fireworks, we are surprisingly settling into a nondescript week for stock pickers," said SPI Asset Management's Stephen Innes. "Frankly, after one of the worst years for bonds and stocks for many investors, the closing chapter of 2022 can't finish quickly enough," he added. Gold was quoted at USD1,814.03 an ounce early Wednesday, flat from USD1,814.62 on Tuesday, while Brent oil fetched at USD80.21 a barrel, slightly higher than USD79.88.

The economic calendar on Wednesday has a consumer confidence survey from the US at 1500 GMT. In UK corporate calendar, there are trading statements from distribution and outsourcing firm Bunzl and cruise line operator Carnival. By Elizabeth Winter, Alliance News senior markets reporter Comments and questions to EMAIL Copyright 2022 Alliance News Ltd.

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