(Alliance News) - Stocks in London are set to open slightly lower on Tuesday, ahead of data on the eurozone economy, and as critical US debt talks resume.

IG says futures indicate the FTSE 100 index of large-caps to open down 9.3 points, 0.1%, at 7,768.4 on Tuesday. The FTSE 100 index ended up 23.08 points, or 0.3%, at 7,777.70 on Monday. It is up 3.0% so far in 2023.

US President Joe Biden will reconvene crunch debt talks Tuesday with senior Republican leaders including House Speaker Kevin McCarthy in another attempt to avert a costly US default.

The talks have a lot of ground to cover, with the two parties still sharply divided on the terms under which they will agree to lift the government's borrowing cap to pay for existing spending commitments.

In the US on Monday, sentiment was boosted by signs of progress in debt negotiations over the weekend.

Wall Street ended higher, with the Dow Jones Industrial Average up 0.1%, the S&P 500 up 0.3% and the Nasdaq Composite up 0.7%.

Sterling was quoted at USD1.2515 early Tuesday, unchanged from the London equities close on Monday.

The euro traded at USD1.0874, edging up from USD1.0871. Against the yen, the dollar was quoted at JPY135.99, down versus JPY136.07.

In Asia on Tuesday, the Nikkei 225 index was up 0.7%. The S&P/ASX 200 in Sydney was down 0.4%.

In China, economic data came in weaker than expected. The Shanghai Composite was down 0.3%, but the Hang Seng index in Hong Kong was up 0.1%.

The National Bureau of Statistics said industrial production grew 5.6% annually in April, faster than 3.9% in March. However, this was below market consensus of 11%, as cited by FXStreet.

Retail sales also came in slightly below estimates, growing 18% annually in April, compared to the market consensus of 21%. The growth was stronger than the 11% seen the month before, however.

Tuesday's data adds to the weaker picture of China's economic recovery painted by reports last week.

"China's April economic data is not pretty," said SPI Asset Management's Stephen Innes.

"Even though today's activity data suggest China is mired in an extended soft patch and maybe even near a tipping point post-reopening recovery, the market likely pre-traded this data, suggesting a base effect beat down was in the price."

Gold was quoted at USD2,015.61 an ounce early Tuesday, flat from USD2,015.35 on Monday. Brent oil was trading at USD75.49 a barrel, slightly higher than USD75.26.

Tuesday's economic calendar has a eurozone gross domestic product reading at 1000 BST. There are UK unemployment data at 0700 BST.

The local corporate calendar has annual results from fast fashion retailer boohoo, telecommunications provider Vodafone and property developer Land Securities. Baker and retailer Greggs gives a trading statement.

By Elizabeth Winter, Alliance News senior markets reporter

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