London pre-open: Stocks to gain further; quiet session expected as US markets closed

(Sharecast News) - London stocks were set to rise at the open on Friday following strong gains in the previous session, as investors continued to mull the weaker-than-expected non-farm payrolls report.

The FTSE 100 was called to open up around 20 points, having hit a two-month high on Thursday after the weak US jobs report tempered concerns about a rate hike.

Friday's session is likely to be fairly quiet as US markets will be closed for Independence Day.

Ipek Ozkardeskaya, senior analyst at Swissquote, said: "Yesterday's weak US jobs data echoed positively across US government bonds and somehow neutralised the negative mood across technology stocks.

"The US economy added 57,000 new nonfarm jobs in June, the past two months' readings were revised lower, wage growth came in line with expectations (0.3% m-o-m and 3.5% y-o-y), while the unemployment rate fell to 4.2%. But that was due to a decline in labour force participation.

"Overall, the data looked soft enough to encourage the market to trim Federal Reserve (Fed) rate hike expectations for this year. The market still expects the Fed to hike once this year - with a little more than a 50% chance of that happening as early as September.

"The US 2-year yield is softer but holding above the 4.10% mark, as US crude rebounds slightly from yesterday's dip to $67pb but remains calm near the $70pb level, with no major headlines on the peace negotiations front. There is more news about increasing oversupply in key markets, and tens of millions of barrels of Iranian oil sailing without a preset destination, than worries about supply shortages."

In corporate news, Harbour Energy founder EIG said it had sold its remaining stake in the oil company via a secondary placing of 54.77 million shares to institutional investors by way of an accelerated bookbuild.

The 3.5% stake was placed at 205p a share with gross proceeds of �112m. EIG, a US-based private equity firm, started the company in 2014 with a plan to build a "new global, independent oil and gas company by acquisition", according to Harbour's website.

Elsewhere, AIM-listed healthcare financial services firm Craneware said it expects its full-year results to be below market expectations due to the timing of the 340B drug pricing programme in the US and the deferral of several contracts.

Revenues for the 12 months to 30 June are now expected to be $205m-208m and adjusted EBITDA at $65m-67m, with both broadly in line with last year.