London pre-open: FTSE to rise as it benefits from low exposure to tech

(Sharecast News) - London stocks were set to rise at the open on Monday as oil prices shot up again, as investors eyed a week filled with central bank policy announcements.

Following a slump in Asian AI-linked stocks, the FTSE 100 was set to benefit from its low exposure to the tech sector, with European stock markets called lower and US futures in the red, but the top-flight index called up around 20 points.

Stocks with AI links tumbled in Asia after the chief executives of Anthropic and OpenAI called over the weekend for the pace of development of AI models to slow down for safety reasons.

Stephen Innes, managing partner at SPI Asset Management, said: "The AI debate didn't just take a sharper turn over the weekend. It ran headlong into a brick wall.

"Dario Amodei's call for a slower pace of frontier-model development, backed by Sam Altman and Elon Musk, suddenly forced markets to contemplate something they have spent most of the past three years treating as almost unthinkable: what happens if the AI race deliberately takes its foot off the accelerator?"

Meanwhile, oil prices gained after new strikes on Saudi Arabia, attacks on vessels near the Strait of Hormuz and the shutdown of Saudi Arabia's East-West pipeline. At 0720 BST, Brent crude was up 2% at $106.72 a barrel and West Texas Intermediate was 2.1% at $102.13.

Danske Bank explained: "The pipeline is a key export route that allows crude to bypass the Strait of Hormuz, and its closure could put up to 4% of global oil supply at risk. At the same time, rising risks regarding the Houthis around the Bab el-Mandeb Strait have added concerns over another important transit route.

"With a planned Gulf-Iran meeting in Oman postponed, markets are likely to remain focused on the risk of further disruption and whether the East-West pipeline can be brought back online quickly."

Looking ahead to the rest of the week, policy announcements from the Bank of England, Federal Reserve and Bank of Japan will be in focus.

In corporate news, Metlen Energy & Metals said it had signed a supply agreement with Malaysia's Petronas for delivery of LNG shipments to Greece.

Under the deal, Petronas will deliver six cargoes per year from its Atlantic portfolio, amounting to approximately 0.6bn metres per year over a period of five years starting in 2027. No financial details were disclosed.

Drugmaker GSK reported two major advances in its oncology pipeline as new data showed its B7H3 antibodydrug conjugate RisRez delivered a significant survival benefit in relapsed small cell lung cancer, while registrational results for Jideytro supported a potential move into firstline ROS1positive nonsmall cell lung cancer.