The FTSE 100 is expected to open lower today as investors hold their breath ahead of key updates from Britain’s top two financial figureheads.
Chancellor Rishi Sunak will this afternoon lay out his latest measures to rescue the economy and save jobs as coronavirus restrictions tighten across the nation.
The Chancellor, who has scrapped next month’s budget, is widely expected to outline a new job support scheme to run when furlough ends on October 31, as well as potentially targeted aid for certain badly-hit sectors.
“It now seems likely that he will finish the furlough scheme, however it is more than likely to be replaced by another type of plan, more suited to the requirements of smaller and more medium sized businesses, as we gear up for a long hard haul toward March 2021,” said CMC Markets analyst Michael Hewson.
Bank of England Governor Andrew Bailey is also due to speak today, with investors still fretting over the impact of negative interest rates – if the central Bank decides to press the button on the unprecedented option.
Meanwhile September’s CBI retail sales numbers, due later this morning, are likely to show a slowdown, from -6 to -10 as the post-lockdown sales bounce loses its fizz.
The address could spell a choppy day’s trading for the pound, already under pressure as Britain hurtles towards the end of the Brexit transition period.
The FTSE 100 is forecast to open 50 points lower at 5849.
In the commodities market, Brent was 0.65% lower to $41.50 a barrel. Oanda analyst Jeffrey Halley observes: “Oil edged lower overnight, ignoring above expected falls in US crude, gasoline and distillate inventories, which is concerning for prices in itself.
“Any premium from the inventory effect got drowned out by a stronger US Dollar and clear risk-off flows out of multiple asset classes.”
In corporate news, a trio of the UK’s hardest hit listed businesses will update the market today. Cinemas operator Cineworld has been pummelled by the forced closure of its venues in lockdown, and the delay of key titles. Investors in the debt-laden company will be looking for signs that consumers feel safe to return to its cinemas in large numbers, and the outlook for the rest of the year.
Carnival and Go-Ahead, which operates the Southeastern rail franchise, are due to update. The cruise market has been undermined by the slowdown in the international travel market and several high profile spreads of Covids on cruise liners. Meanwhile, the Government this week effectively renationalised the railways, slimming margins but reducing risk for rail operators, so any commentary on the situation from Go-Ahead will be closely watched.