London pre-open: Stocks seen up amid corporate deluge

(Sharecast News) - London stocks were set to rise at the open on Thursday as investors braced for a barrage of corporate news, including results from Shell and Standard Chartered. The FTSE 100 was called to open around 40 points higher.

Investors will be mulling the latest policy announcement from the Federal Reserve.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: "The Federal Reserve decision yesterday was... interesting. As expected, the Fed kept its rates unchanged and said that they are not confident to cut the interest rates as inflation has started to show signs of heating up. Jerome Powell reassured that the Fed's next move will unlikely be a rate hike. That was a relief.

"Then, the Fed said that it will start tapering QT. It sounded like 'the rates must stay longer in the oven but taste this - in the meantime'.

"The market reaction to the decision was mixed. The stocks first gained then erased losses. The S&P500 closed the session down by 0.34%. The treasury yields fell. The 2-10year portion of the yield curve remains inverted, mind you, since summer 2022.

"Maybe - but just maybe - we will finally see recession arrive to the US? Note that the latest GDP print in the US surprised by a sharp slowdown to 1.6%, from above 3% printed a quarter earlier, and down from 5% printed the quarter before that. Interest rate swaps still price in one rate cut for 2024, sometime by the year end."

In UK corporate news, oil and gas giant Shell reported a 15% jump in earnings in the first three months of the year compared with the final quarter of the year on the back of higher margins from crude and oil products trading. It also unveiled a new $3.5bn share buyback.

Adjusted core earnings came in at $18.7bn compared with $16.3bn in the fourth quarter, but lower than the $21.2bn reported in the first quarter of 2023.

Precision measurement group Spectris kept its projections for 2024 unchanged despite a "softer-than-anticipated" first quarter, with sales falling against a strong comparative period last year.

The company, which provides high-tech instruments, test equipment and software for industrial applications, said sales were down 8% on a like-for-like basis in the three months to 31 March, with conditions in some of its end markets like China weaker than hoped.

However, "we continue to expect to deliver progress this year as markets improve, with progress weighted towards the second half", said chief executive Andrew Heath.

Smurfit Kappa reported first-quarter revenue of €2.7bn and EBITDA of €487m, achieving an EBITDA margin of 18%.

The company said it experienced ongoing growth in corrugated box volumes in the period, as expected, while it successfully completed a bond offering of $2.75bn.

Additionally, integration planning for the Smurfit WestRock merger was said to be advancing positively.