London pre-open: Stocks to edge lower; US tech earnings eyed

(Sharecast News) - London stocks were set to nudge lower at the open on Monday as oil prices fell and as investors eyed a slew of US tech earnings this week.

The FTSE 100 was called to open around 10 points lower. At 0720 BST, Brent crude was down 2.2% at $107.45 a barrel and West Texas Intermediate was 1.9% lower at $99.52 after US President Donald Trump waived sanctions and tariffs on Russia, potentially allowing higher fuel exports.

Danske Bank said: "Still, supply risks remained elevated, as Ukraine struck Russian energy infrastructure on Sunday and attacks on vessels near Hormuz continued to threaten Gulf crude flows."

Looking to the rest of the week, attention will turn to a raft of US tech earnings.

Ipek Ozkardeskaya, senior analyst at Swissquote, said: "Meta takes centre stage, alongside Tesla, IBM, Western Digital and Texas Instruments. Investors will want to hear more than another ambitious spending plan: they will want evidence that AI is helping generate enough revenue and profit to justify the bill.

"As for spending, it remains a delicate balance. On one hand, strong AI spending plans reassure investors that demand for AI infrastructure remains intact and sustain appetite for AI enablers, starting with chipmakers and data centre providers. But too much spending fuels concerns about financing - including leverage and circular financing - and returns.

"On the other hand, more cautious spending could ease those financing and return concerns, while pulling the rug from under the companies counting on that money.

"So what investors really need is stronger monetisation - proof that the revenues generated with AI can catch up with the spending on AI tools.

"Because after last week, another promise to spend billions may not sit well in investors' stomachs..."

In UK corporate news, LondonMetric Property flagged a jump in net income, leaving it on track to meet consensus, despite the challenging macroeconomic backdrop.

Updating on trading ahead of interim numbers, the real estate investment trust said net rental income rose by more than 8% to £240m, boosted by last year's acquisition of Urban Logistics, high occupancy and "very strong" rent review and leasing activity.

The average uplift during the first half from rent reviews was 17%, while rent collection was 99.3% and occupancy was 97.4%.

As a result, LondonMetric said it remained "firmly on track" to meet consensus for full-year earnings per share, of 13.9p.

Power and data transmission product maker Volex said it expected full-year earnings to be at the upper end of expectations as it benefited from the rush to build artificial intelligence centres.

Group revenue for the first half is expected to be at least $710m, including a contribution of approximately $11m million from data cable transmission tester Kepler SignalTek, the acquisition of which completed in July.