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London open: Stocks rebound ahead of UK manufacturing data
London stocks rebounded on Wednesday ahead of the release of UK manufacturing data.
Weak Chinese data weighed on equities on Tuesday but the market has turned around as investors await UK manufacturing and industrial reports and weigh an increase in oil prices.
Data at 0930 GMT is expected to show UK manufacturing production declined 0.7% year-on-year in January while industrial output was flat.
“The manufacturing sector has borne the brunt of the global economic slowdown over the past few months and once again the UK economy is in the cross hairs today with the latest ONS manufacturing and industrial production data for January,” said Michael Hewson, chief market analyst at CMC Markets.
In a boost to the market, oil prices rose in morning trade. Brent crude increased 0.32% to $39.78 per barrel and West Texas Intermediate climbed 0.24% to $36.59 per barrel at 0900 GMT.
A report on US crude oil inventories from the Department of Energy at 1530 GMT will be closely scrutinised amid concerns about the supply glut.
In company news, Prudential was the biggest riser after posting a better-than-expected annual pre-tax profit of £4bn, up 22% on the previous year,supported by strong performances at its British, US and Asian life insurance businesses.
Ashtead’s shares slumped after Credit Suisse downgraded the stock to ‘underperform’ from ‘outperform’ and slashed the price target to 770p from 1,300p.
The Restaurant Group was under the cosh after saying 2015 like-for-like sales faltered as the challenging trading conditions from the end of last year continue into 2016 and look set to linger for longer.
DS Smith rallied after saying in a trading update that volumes and financial returns continue to grow despite ongoing challenging market conditions.
