(Alliance News) - Stocks in London are set to add to their gains at Thursday's open, following Wednesday's rally and a strong finish on Wall Street.
IG says futures indicate the FTSE 100 index of large-caps to open up 28.0 points, 0.4%, at 7,592.27 on Thursday. The FTSE 100 index jumped 80.02 points, 1.1%, to 7,564.27 on Wednesday.
"European markets finished the day higher for the third day in succession yesterday as confidence continued to return after the upheaval of the last two weeks," said CMC Markets chief market analyst Michael Hewson.
"US markets also underwent a similarly strong session with tech stocks leading the recovery, while financials also continued to stabilise."
In New York, the Dow Jones Industrial Average closed up 1.0%, the S&P 500 up 1.4% and the Nasdaq Composite up 1.8%.
The UK's private sector shrank for the eighth quarter in a row at the start of 2023 but saw a slowdown in decline, according to new data.
The Confederation for British Industry said its latest growth report showed "signs of green shoots" amid projections that UK industry will return to growth in the next quarter.
However, the fresh CBI data showed that activity across the UK private sector contracted by around 4% over the three months to March. It is the eight consecutive quarter of decline but the mildest drop since July 2022.
The drop was largely driven by weakness in the service sector, amid an 11% drop in consumer services volumes, according to the survey.
Meanwhile, the dollar was mixed against major currencies, with the pound weakening slightly.
Sterling was quoted at USD1.2316 early Thursday, lower than USD1.2326 at the London equities close on Wednesday. The euro traded at USD1.0844, higher than USD1.0834. Against the yen, the dollar was quoted at JPY132.55, up slightly versus JPY132.51.
The day's economic calendar has the final iteration of US gross domestic product data for the final quarter of 2022 at 1330 BST.
CMC's Hewson said the market is expecting a "modest revision upwards to 2.8% [annual growth] from 2.7%, which would be a modest slowdown from the 3.2% seen in Q3".
Shortly before, there will be a flash German inflation reading for March at 1300 BST.
Inflation had remained unchanged at 8.7% in February, with the market having expected it to cool to 8.5%. Market consensus, as cited by FXStreet, is expecting a reading of 7.3% this month. On a EU harmonised basis, inflation is expected to cool to 7.5% from 9.3%.
"A sharp fall would be well received by some of the more dovish members of the ECB governing council, but also by financial markets who still have concerns that central banks might overtighten," Hewson noted.
In Asia on Thursday, investor sentiment was more mixed. The Nikkei 225 index in Tokyo was down 0.8%. In China, the Shanghai Composite was up 0.1%, while the Hang Seng index in Hong Kong was up 0.1%. The S&P/ASX 200 in Sydney closed up 1.0%.
Brent oil was trading at USD77.98 a barrel early Thursday, lower than USD78.37 late Wednesday. Gold fetched USD1,962.24 an ounce, down from USD1,967.03.
Thursday's local corporate calendar has a trading statement from greeting cards and gifting firm Moonpig and annual results from North Sea oil and gas operator Ithaca Energy.
By Elizabeth Winter, Alliance News senior markets reporter
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