London pre-open: Modest rise after Fed minutes, ahead of BoE rate decision

10th Jul 2014 07:44

A modest rise is expected amongst London's blue chips this morning, tracking stronger gains seen across the Pond last night following the release of the Federal Reserve's minutes from its meeting last month.The minutes indicated that officials were sanguine about holding their current policy course. The FTSE 100 is expected to notch up around eight points at the opening bell, having closed at 6,718.04 yesterday afternoon. The Fed released the notes from its June 17-18th meeting, when the central bank's Federal Open Market Committee cut monthly bond purchases by $10bn to $35bn. At the time Fed Chair Janet Yellen had said interest rates will probably stay low for a considerable time.The minutes showed officials were not overly concerned by recent gross domestic product figures' hints of renewed inflation and plan to bring their monthly asset purchases to a halt in October, if the economy continues on its present course.Here in the UK, today's focus will be firmly on the Bank of England's (BoE) latest decision on interest rates. "The UK will be a major focus today as we get the BoE interest rate decision," said James Hughes, a market analyst at Alpari. "Of course expectations are for no change at today's meeting, but recent rumours of a rate hike in the second half of 2014 have been gathering pace of late. If we are to get no change in policy today, which is as expected then the vote counts at the meeting minutes will take on added importance."In company news, high-end fashion group Burberry saw underlying growth in retail sales pick up in the first quarter, but warned that currency headwinds have increased. Retail revenues totalled £370m in the three months to June 30th, up 17% on an underlying basis, which excludes FX movements. This was a decent acceleration from the 13% registered in the second half of the previous financial year. However, growth on a reported basis slowed to 9% in the first quarter, from 11% in the second half.Telecoms behemoth Vodafone has signed a new partnership deal with Bemobile, which will become its exclusive partner in Papua New Guinea and the Solomon Islands. Under the Partner Market agreement, Bemobile, which trades as "bmobile", the two companies will jointly offer business and consumer customers a range of products and services.Pre-tax profits at Barratt Developments will hit the top end of analyst expectations, the company boasted in a pre-close statement, as a significant increase in housing completions accompanied a 13% jump in selling prices. Group Chief Executive Mark Clare said: "The market remains positive with strong demand for new homes across the country. The land we have acquired in the last five years together with our disciplined operating model is delivering a very strong business performance." NR