London pre-open: Stocks seen up after Fed, ahead of earnings

(Sharecast News) - London stocks were set to gain at the open on Thursday as investors mulled the Federal Reserve's latest policy announcement and a slew of US tech earnings, and braced for a raft of UK corporate releases.

The FTSE 100 was called to open around 25 points higher.

The Federal Reverse kept its benchmark rate steady at 3.5% to 3.75% on Wednesday, as widely expected.

Ipek Ozkardeskaya, senior analyst at Swissquote, said: "The US Federal Reserve (Fed) mostly did what was expected when it announced its policy update yesterday: it kept rates unchanged. Fed Chair Powell didn't comment on the latest political drama surrounding the Fed and himself, nor on whether he would leave the committee when his term as Chair ends in May. Instead, he advised the next lucky person to take the helm of the Fed to 'stay out of elected politics'."

She said the surprise came from the economic outlook. "Powell pointed to a 'clear improvement' in the US outlook, said the job market shows signs of steadying, and highlighted surprisingly 'strong' growth," said Ozkardeskaya. "But a good part of that growth is explained by AI investment, which for now does not create many jobs."

As far as the tech earnings from Tesla, Meta and Microsoft - three of the 'Magnificent Seven' - are concerned, she noted that while they all beat expectations and announced higher AI spending, market reactions varied sharply.

In UK corporate news, Lloyds Bank reported a better-than-expected 12% jump in annual profit driven by higher income which offset �800m set aside to compensate customers who were mis-sold motor finance.

The lender posted pre-tax earnings of �6.7bn, beating forecasts of �6.4bn. It also lifted its performance estimates for 2026, including a return on tangible equity greater of more than 16% and underlying net interest income of �14.9bn.

The board also announced a share buyback programme of up to �1.75bn and said it would now review excess capital distributions in addition to the ordinary dividend every half year.

EasyJet reiterated full-year guidance on the back of robust first-quarter sales and growing demand for summer holidays.

Updating on trading, the budget carrier said available seat kilometres (ASK) capacity rose 9% year-on-year in the three months to December end, with passenger numbers up 7% and the load factor two percentage points stronger at 90%.

The headline loss widened to �93m, from �61m a year previously. However, the airline said bookings were "building well" for the summer season, and left its full-year outlook unchanged.

Private equity firm 3i reported a further rise in net asset value over the nine months to December, supported by another strong year from Action, which continued to drive the group's overall performance.

3i said that NAV per share increased from 2,857p on 30 September to 3,017p at the end of December, with its 20% total return for the period being aided by favourable currency movements.