London pre-open: Stocks to fall after Westminster chaos

(Sharecast News) - London stocks were set to fall at the open on Thursday following losses in the US and Asia, and after a day of chaos at Westminster. The FTSE 100 was called to open 18 points lower at 6,907, with Liz Truss's future as prime minister increasingly uncertain.

On Wednesday, Suella Braverman resigned as home secretary, having breached ministerial rules after sending an official document from her personal email account. On her way out, she took a swipe at the government, however, accusing it of breaking "key pledges" and failing to reduce immigration.

There was further turmoil during a vote on fracking, as opposition MPs said some Conservatives had been bullied and manhandled into voting with the government.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: "Liz Truss is really in a hot seat, as the chaos among the Tories got worse yesterday, after Home Secretary Braverman got fired for sharing confidential information.

"It is said that many Conservative Party members want Truss to resign immediately.

"Cable continued falling, while the gilt yields eased - more on the long-end of the curve as the Bank of England (BoE) said it will not be selling that part of the curve. But the Financial Times said that the UK is now paying extra money to borrow due to the 'moron risk', as the British leaders are a 'few sandwiches short of a tea party'."

In corporate news, homewares retailer Dunelm reported a fall in first-quarter sales and maintained annual guidance despite a challenging macroeconomic environment.

The company said sales for the 13 weeks to October 1 fell 8% to £357m against a tough comparator last year when people spent more on home improvements during Covid lockdowns. Revenue rose 36% against pre-pandemic levels.

Distribution and services group Bunzl said that its "diversified and resilient business model" had delivered "strong growth", with Q3 group revenues up 18.8% at actual exchange rates and 8.7% at constant exchange rates.

Bunzl also stated that despite "a slowing macroeconomic environment", full-year guidance remained unchanged at constant exchange rates, with the firm expecting to deliver "very good" revenue growth in 2022.