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London open: Stocks slump on G20 China stimulus disappointment
UK stocks declined on Monday on disappointment at the lack of specific stimulus plans for China’s flagging economy at the G20 meeting in Shanghai.
Investors had been hoping China’s government would announce measures to boost the economy over the weekend after People’s Bank of China chief Zhou Xiaochuan said on Friday there was more room for easing. However, such an announcement failed to materialise at the G20 meeting, sending Asian stocks into the red along with UK and European equities.
Meanwhile, oil prices were mixed in morning trade. Brent crude was up 0.25% to $35.19 per barrel while West Texas Intermediate fell 0.30% to $32.68 per barrel at 0902 GMT.
In economic data, the day will be quiet in the UK with the only notable release being net lending to individuals 0930 GMT.
Instead the focus will be in the Eurozone with the release of inflation data at 1000 GMT. Analysts expect the February preliminary estimate to show the consumer price index fell to 0% from 0.3% growth in January. Such a figure would add pressure on the European Central Bank to expand quantitative easing at the 10 March policy meeting.
Elsewhere in Europe, a report from Destatis revealed German retail sales rose 0.7% in January from a month earlier after an upwardly revised 0.6% increase in December. Economists had expected a 0.3% gain.
Separately, the German import price index fell 1.5% month-on-month in January, more than the 1% drop predicted by analysts and compared to December’s 1.2% dip.
Still to come, the Chicago purchasing managers’ index will be released at 1445 GMT, US pending home sales figures are due at 1500 GMT, and the Dallas Fed manufacturing index will be published at 1530 GMT.
In company news, Morrison’s shares jumped after the company said it has inked a new supply agreement with online retailer Amazon.com that will make hundreds of its products available to Amazon Prime Now and Amazon Pantry customers in the coming months.
Keller Group rallied after reporting solid full year earnings despite a fall in revenue.
Barclays slumped as it noted recent media speculation regarding a potential sale of its shareholding in Barclays Africa Group Limited and said it was evaluating its strategic options.
A gauge of other banking stocks were also under the cosh, including Standard Chartered, HSBC and Lloyds Banking Group.
