(Alliance News) - Stocks in London are set to open slightly higher on Wednesday, as cautious trading continues, with an absence of key market drivers.

IG says futures indicate the FTSE 100 index of large-caps to open up 8.0 points, 0.1%, at 7,492.25 on Wednesday. The FTSE 100 index closed up 12.48 points, 0.2%, at 7,484.25 on Tuesday.

"European markets struggled for direction yesterday, with upward pressure on short-term [bond] yields serving to act as a modest drag on the markets ability to build solidly on the gains seen on Monday," said CMC Markets' Michael Hewson.

"There still appears to be an abundance of caution when it comes to driving prices higher, in the wake of the turmoil of last week with the rise in yields also pressuring US markets, which also struggled with the Nasdaq 100 feeling the effects of firmer rates the most."

Stocks on Wall Street slid on Tuesday, with the Dow Jones Industrial Average ending down 0.1%, the S&P 500 down 0.2%, and the Nasdaq Composite down 0.5%.

The pound was weaker in early exchanges in London on Wednesday, quoted at USD1.2321, lower than USD1.2339 at the London equities close on Tuesday.

The euro traded at USD1.0836, steady on USD1.0839. Against the yen, the dollar was quoted at JPY131.69, up versus JPY130.98.

"It could be time for the US dollar to halt [its] sell-off and consider a potential rebound, if the US yields recover a part of losses related to bank stress," said Swissquote Bank's Ipek Ozkardeskaya.

Meanwhile in Switzerland, UBS has enlisted the help of its former chief executive officer, following its takeover of Credit Suisse. Sergio Ermotti, currently chair at insurer Swiss Re, will retake the helm of the Swiss bank next month.

Ermotti was previously CEO of UBS from late 2011 to October 2020, during which time he "successfully repositioned UBS following the severe challenges arising from the global financial crisis", the bank asserted.

Incumbent UBS CEO Ralph Hamers has "agreed to step down to serve the interests of the new combination, the Swiss financial sector and the country", UBS said.

In Asia on Wednesday, the Nikkei 225 index was up 0.8%. In China, the Shanghai Composite was down 0.1%, while the Hang Seng index in Hong Kong was up 2.1%. The S&P/ASX 200 in Sydney closed up 0.2%.

Gold was quoted at USD1,965.99 an ounce early Wednesday, edging lower from USD1,967.14 on Tuesday. Brent oil was trading at USD78.94 a barrel, up slightly from USD78.09.

Wednesday's economic calendar has a German consumer climate survey at 0700 BST. The UK corporate diary has annual results from retailer Next and advertising agency S4 Capital.

By Elizabeth Winter, Alliance News senior markets reporter

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