London pre-open: Stocks seen up ahead of PMIs

(Sharecast News) - London stocks were set to rise at the open on Wednesday following a positive Asian session and after losses a day earlier. The FTSE 100 was called to open 20 points higher at 7,896.

Investors will be looking ahead to a slew of data releases, with mortgage approvals, consumer credit and manufacturing PMI all due at 0930 GMT.

CMC Markets analyst Michael Hewson said: "Today's final manufacturing PMIs from Spain, Italy, France, Germany and the UK are set to point to a mixed outlook when it comes to economic activity, with manufacturing expected to show an improvement to 49 and 51 in Spain and Italy and declines to 47.5 and 46.3 in France and Germany respectively.

"We also have more economic data from the UK, where consumers are being similarly squeezed by higher prices and some shortages. UK manufacturing PMI is expected to be confirmed at 49.2, an increase from 47.

"Mortgage approvals have also been in decline in the face of the slowing economy and falling house prices. At the end of last year approvals fell to their lowest levels since May 2020 at 35.6k and could see a modest pickup in January to 38.5k, however it is clear that higher rates are weighing on demand for mortgages, as well as property.

"Net consumer credit has slowed from the levels we were seeing in the summer, falling to £500m at the end of last year. This could see a modest pickup to £800m in January."

In corporate news, Persimmon warned on profits after the housebuilder was knocked by a spike in mortgage rates.

The company said it had delivered a "very strong performance" in 2022, with total new home completions of 14,868, compared to 14,551 a year previously.

But it warned completions would likely be down "markedly" in the current year, which would hit both margin and profits.

Rathbones Group reported a 19.6% drop in full-year underlying profit before tax to reach £97.1m with income ahead by 4.6% but operating expenses rising by 13.8%.

Earnings per share meanwhile came in at 83.6p for a 37.4% drop versus 2021. Total funds under management and administration at the investment and wealth management outfit fell by 11.6% over the year ending on 31 December 2022 to reach £60.2bn, but discretionary and managed net inflows were "resilient", the group said, growing by £1.3bn or 2.6%.

The firm also reiterated a goal to return to "a more usual" higher 20s underlying operating margin by end 2024 as the benefits of recent acquisitions and planned investments were achieved.

A final dividend of 56.0p per share was declared for 2022, against 54.0p for the year before, taking the total dividend payout per share from 81.0p to 84.0p.