London pre-open: Stocks to rise ahead of ECB announcement

(Sharecast News) - London stocks were set to rise at the open on Thursday as investors continued to mull the Autumn Budget, along with the Federal Reserve's decision to leave rates unchanged, as expected.

The FTSE 100 was called to open around 20 points higher.

Overnight, the Fed left policy rates unchanged at between 3.75% and 4.00%, as expected, with Hammack and Cook dissenting and favouring a 25 basis points hike. "The statement was largely unchanged, although the upgrade of the economic activity to a 'strong' pace from a 'solid' pace marked a slight hawkish shift," Danske Bank said.

"At the press conference, Warsh said that growth was probably above 3% in Q3, while also flagging the recent tightening of financial conditions and offering no specific guidance on the future rate path.

"Although the market reaction was to the dovish side, we read Warsh's comments on the economic outlook as hawkish."

Danske maintained its call for 25bp hikes in December and March, with risks tilted towards more than two hikes.

Looking to the rest of the day, investors will turn their attention to UK mortgage approvals and consumer credit data for September at 0930 GMT and the latest policy announcement from the European Central Bank at 1315 GMT. The ECB is expected to leave rates at 2.50%.

In corporate news, Lloyds Banking Group said it was on track to meet 2026 guidance as it reported a rise in third-quarter profit that was in line with analysts' expectations.

In the three months to September end, pre-tax profit increased to £2.3bn from £1.2bn in the same period a year earlier. Analysts were expecting £2.28bn.

Chief executive Charlie Nunn said: "The group is delivering sustained strength in financial performance, with continued income growth, improving operating leverage and strong and stable credit performance. Our differentiated business model is performing well and we are on track to meet our 2026 guidance.

"We are maintaining strategic delivery as we continue to focus on supporting UK households and businesses. As we near completion of our current strategic chapter, we are excited to begin executing on our new strategy, Accelerate 2030. This will ensure we can deliver continued, sustainable value for our customers and shareholders."

Engineering firm IMI lifted its fullyear earnings guidance, raising its adjusted EPS range to 137p-143p after a strongerthanexpected contribution from Truflo Marine ahead of its disposal and firmer trading in its transport unit.

IMI said it remained on track to deliver a sixth consecutive year of midsingledigit organic revenue growth, with thirdquarter organic revenue up 2% against a tough comparator and statutory revenue rising 3% on FX.