London open: FTSE nudges up ahead of Fed announcement, UK data

(Sharecast News) - London stocks nudged higher in early trade on Monday as investors eyed this week's policy announcement from the US Federal Reserve amid expectations of a 25 basis point cut, with key UK data releases also due.

At 0830 GMT, the FTSE 100 was 0.1% higher at 9,673.79.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "On the domestic front, key UK data points to look out for this week include November's retail sales figures which are scheduled Tuesday. The previous month saw sales contract by 1.2% and with pre-budget caution likely to have dominated in November and accountants BDO playing down the success of Black Friday promotions, tomorrow's numbers could struggle to get back into positive territory.

"Turning to the wider economy, GDP numbers for October are expected to land on Friday. Forecasts are looking for a 10-basis point acceleration in monthly growth to 0.2% after a cyber-attack at Jaguar Land Rover weighed on the September numbers.

"But it's events in the United States that will take centre stage this week. Anything other than a quarter point cut to Fed Funds Rates on Wednesday will come as a big surprise but cast your eyes forward 12 months and the waters become much muddier.

"Markets see two further quarter point cuts as the most likely outcome but the probability of a doveish third cut, or just a hawkish single cut isn't that far behind. It's commentary for 2026 and beyond that's likely to be the key focus for markets."

Rate announcements are also due this week from the Reserve Bank of Australia, the Bank of Canada and the Swiss National Bank, all of which are expected to keep rates unchanged.

In equity markets, medical devices group Smith & Nephew gained as it unveiled plans to downsize its portfolio, alongside an increase in full-year guidance. Updating shareholders ahead of a capital markets day in London, S&N said it had identified opportunities to "simplify" its product range.

Long-term, it expects the rationalisation to reduce gross inventory by around $500m and lead to a "significant" reduction in capital requirements. It will, however, take a non-cash provision in the 2025 accounts of $200m as a result of the shake-up.

Kainos surged after an upgrade to 'buy' at Bank of America Merrill Lynch.

On the downside, Unilever slumped as it completed the demerger of its ice cream business.

Admiral and M&G were also weaker after JPMorgan downgraded the shares to 'underweight' from 'neutral' and to 'neutral' from 'overweight', respectively.