(Alliance News) - Stocks in London are set to open higher on Monday, amid a downbeat trading session in Asia as fears grow of an escalation in the conflict in the Middle East.
IG says futures indicate the FTSE 100 to open up 17.9 points, 0.2%, at 7,617.5 on Monday. The index of London large-caps closed down 45.18 points, or 0.6% at 7,599.60 on Friday.
"The world now holds its breath as Israel prepares for a full-scale ground invasion of Gaza, with only unseasonal torrential rain delaying the seemingly inevitable," noted Rabobank analysts.
More than one million people have fled their homes in Gaza in scenes of chaos and despair as Israel bombarded the Hamas-ruled Gaza Strip and continued amassing troops Monday in preparation for a full-blown ground invasion.
US President Joe Biden said in an interview with the CBS news programme 60 Minutes that while invading and "taking out the extremists" was needed, any move to occupy the territory would be a "big mistake".
Hamas backer Iran and Lebanon's Hezbollah, which is also supported by Tehran, have warned that an invasion would be met with a response. "No one can guarantee the control of the situation and the non-expansion of the conflicts" if Israel sends its soldiers into Gaza, said Iran's Foreign Minister Hossein Amir-Abdollahian.
Fire along the Israeli-Lebanese border has intensified in the last week, prompting Israel to shutter the area to civilians.
"As a result of this continuing uncertainty and the war of words being played out in plain sight it’s hard to see much in the way of upside for stock markets unless there is a dialling back in the tension which is currently convulsing the region, with markets in Europe set to open modestly higher, despite a weak Asia session," said CMC Markets' Michael Hewson.
The FTSE 100 is likely to find support from commodity stocks, as oil holds onto its recent price gains.
Brent oil was trading at USD90.92 a barrel early Monday, rising further from USD89.59 late Friday. It crossed above USD91.00 in the early hours. The price is up sharply from USD86.62 a barrel early on Friday morning.
In Asia on Monday, the Nikkei 225 index in Tokyo was down 1.9%. In China, the Shanghai Composite was down 0.4%, while the Hang Seng index in Hong Kong was down 0.6%. The S&P/ASX 200 in Sydney closed down 0.4%.
Sterling was quoted at USD1.2161 early Monday, higher than USD1.2135 at the London equities close on Friday. The euro traded at USD1.0526, up from USD1.0498. Against the yen, the dollar was quoted at JPY149.40, down versus JPY149.66.
In the US on Friday, Wall Street ended mixed, with the Dow Jones Industrial Average up 0.1%, the S&P 500 down 0.5% and the Nasdaq Composite down 1.2%.
In early UK news, house price growth was muted this month by October's usually loftier standards, numbers from Rightmove showed, though the property portal noted some calm is returning to the mortgage market.
According to Rightmove, UK house prices rose 0.5% on-month in October, quickening slightly from September's 0.4% rise. However, this month's rise is markedly cooler than the 1.4% "historic norm" house price expansion usually delivered in October.
Gold was quoted at USD1,919.84 an ounce early Monday, lower than USD1,922.99 on Friday.
In Monday's UK corporate calendar, there are annual results from Seeing Machines and Tristel.
The economic calendar gets off to a quiet start this week. There is UK employment data on Tuesday, Chinese economic growth, retail sales and industrial production as well as EU inflation data on Wednesday, and the weekly US unemployment claims report on Thursday.
By Elizabeth Winter, Alliance News senior markets reporter
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