FTSE 100 to open higher as traders shrug off China virus concerns
The FTSE 100 is expected to begin Wednesdays session on the front foot as investor optimism began to return despite lingering concerns around the spread of the Wuhan virus.
Spread-better IG expects the FTSE 100 to open around 27 points higher after ending Tuesdays session 41 points lower at 7,611.
News that the pneumonia-like virus has spread to the US caused some jitters on Wall Street overnight as investors remain concerned that a potential pandemic could drag on economic growth.
The Dow ended Tuesdays session 0.5% lower at 29,196 while the S&P 500 was down 0.27% at 3,320 and the Nasdaq fell 0.19% to 9,370.
However, these concerns had mostly dissipated in the Asian markets by Wednesday, with the Japanese Nikkei 225 up 0.7% while Hong Kongs Hang Seng was 1.3% higher.
Michael Hewson, chief market analyst at CMC Markets, said that markets are currently adopting “a safety-first approach” in the face of the disease, particularly with concerns that Chinese New Year celebrations, which begin this weekend, could help the virus spread on a wider scale.
On the currency markets, the pound was 0.1% higher at US$1.3057 against the dollar, with todays CBI business confidence data possibly providing some catalysts as a barometer for the UKs economic health in the final weeks before Brexit. There could also be some movement in cable as the Senate impeachment trial against Donald Trump continues to shake US politics.
Significant announcements expected for Wednesday January 22:
Trading announcements: Burberry Group PLC (LON:BRBY), JD Wetherspoon PLC (LON:JDW), Sage Group PLC (LON:SGE), AJ Bell PLC (LON:AJB), Antofagasta PLC (LON:ANTO),Connect Group PLC (LON:CNCT), Close Brothers Group PLC (LON:CBG), Pets at Home Group PLC (LON:PETS), WH Smith PLC (LON:SMWH)
Economic data: US house prices