The FTSE 100 is expected to open lower on Thursday as investors in London take a cautious stance ahead of trading updates from Tesco and Marks & Spencer, two companies seen as bellwethers for UK consumer spending.
Market sentiment remains fragile after a weaker midweek session, with global markets offering little support and oil prices drifting lower.
Why is the FTSE 100 opening lower this morning?
Early indicators from spread betting firm IG suggest the FTSE 100 will open down around 0.4%, putting the index close to 10,003 points at the opening bell.
That would extend Wednesday’s losses, when the benchmark index closed 0.7% lower at 10,048.21.
The decline reflects a mix of investor caution and a lack of clear positive drivers. With several heavyweight UK retailers reporting, many traders are choosing to sit on the sidelines until they have a clearer picture of how British consumers are coping with ongoing cost pressures.
Why do Tesco and Marks & Spencer matter so much to the UK markets?
Updates from Tesco and Marks & Spencer are closely watched because they offer a real-time snapshot of household spending across the UK.
Tesco, as the country’s largest supermarket, provides insight into grocery inflation, pricing strategies, and whether shoppers are trading down to cheaper products.
Marks & Spencer, meanwhile, straddles both food and clothing, making it a useful gauge of discretionary spending.
Any signs that shoppers are cutting back more sharply than expected could weigh on retail stocks and, by extension, the FTSE 100, which often reacts strongly to consumer-facing results.
How are global markets shaping sentiment in London?
Overnight trading offered little reassurance for European investors. On Wall Street, the picture was mixed, with the Dow Jones Industrial Average falling sharply while tech-heavy stocks provided some support.
This uneven performance has left global investors unsure about the near-term direction of equity markets.
In Asia, losses were more pronounced. Japan’s Nikkei fell more than 1.5%, while Hong Kong stocks also dropped heavily.
Such weakness often spills into early European trading, particularly when there is no strong domestic catalyst to counter it.
What role is oil playing in today’s FTSE 100 outlook?
Oil prices slipped slightly, with Brent crude trading near USD 60.18 a barrel, adding pressure to energy shares that make up a significant portion of the FTSE 100.
The move follows comments from US Energy Secretary Chris Wright, who said Washington would take control of sales of Venezuelan oil for the foreseeable future.
The US has confirmed it will ease some sanctions to allow Venezuelan crude to reach global markets, although it has not yet set out a clear timeline. The prospect of additional supply has helped keep oil prices subdued.
What’s happening with the pound and why does it matter?
Sterling edged slightly lower against the US dollar in early trading, slipping to around USD 1.3459.
While the move is modest, a weaker pound can support multinational companies in the FTSE 100 by boosting the value of overseas earnings when they are converted back into pounds.
However, today’s currency shift was too small to significantly offset broader market caution.
Which economic data should UK investors watch today?
Beyond company news, attention will turn to the Halifax house price report, a closely followed indicator of the health of the UK housing market.
With mortgage rates still elevated, any sign of renewed weakness in house prices could influence sentiment towards banks and housebuilders.
Internationally, eurozone unemployment figures and US weekly jobless claims are also due, which may affect global market mood later in the day.
