Top flight shares started Thursday in negative territory as traders nervously awaited the outcome of the US Federal Reserve's interest rate deliberations.
The FTSE 100 Index fell 19.83 points to 6209 in the first hour of trading, but that was still a four-week high after Wednesday's positive reaction to upbeat UK job news.
The Fed's decision was expected to eclipse other economic news such as UK retail sales, which came in slightly down on last month's data.
Connor Campbell at spread-betting firm Spreadex said: "It is unlikely investors will be too moved by this figure given the significance of today’s Fed decision and the market-dampening effect the pre-statement jitters are causing."
Asian and US equities gained despite a lack of clarity about which way the Fed will turn in its rate decision. Fed fund futures imply a less than 25% chance of a hike while analysts and economists polled are 50/50, said Mike van Dulken at Accendo Markets.
Theme park and tourist attraction operator Merlin Entertainments (LON:MERL) dropped 4.9p to 377.8p as it said downbeat trading in its theme park business could continue to impact profit into next year.
Shares in Constellation Healthcare Technologies (LON:CHT) were flat at 144p as the provider of support services to US hospitals and clinics said it was on the lookout for more acquisitions.
Shanta Gold (LON:SHG) sparkled 0.25p to 4.38p as the East Africa-focused gold producer, developer and explorer said production and costs were still at budgeted levels and it was on course to hit full-year guidance.
MARKET PREVIEW
Not exactly Christmas, but the day the market has spent months waiting for is now here – and there’s probably a fair chance of disappointment.
Later this evening, after trading in London has finished, US Federal Reserve chair Janet Yellen will reveal whether or not American interest rates will be increased.
Wall Street closed Wednesday higher, again, and it would appear that traders are betting that the economic conditions are still not quite right for the Fed to raise rates.
“This is the most highly anticipated Fed decisions in years and investors, analysts and economists everywhere are split on whether the central bank will raise interest rates this month,” said Craig Erlam, analyst at OANDA.
“The markets on the other hand seem pretty convinced, which is quite surprising given the repeated warnings from Fed Chair Janet Yellen that the intention is to raise rates this year.
“Markets are currently pricing in a less than 25% chance of a rate hike at today’s meeting which is quite surprising and leaves them open to quite a shock if the Fed does proceed as warned.”
The Dow Jones gained 140 points, 0.84%, to close at 16,739 while the S&P 500 ended 0.87% higher at 1,995 and the Nasdaq moved up 0.59% to 4,889.
In Asia, Japan’s Nikkei advanced 1.55% to 18,454 while Hong Kong’s Hang Seng added 0.77% to 22,456 and the Shanghai Composite index edged up 0.28%.
Australia’s ASX 200 climbed 46 points, 0.9%, to 5,144.
In the commodity market the price of oil rallied strongly – Brent crude gained over 4% back up to US$50 per barrel – and the gold price was also moved higher, to around US$1,120 per ounce.
In London, IG Markets is calling the FTSE 100 up about 16 points this morning at 6,256 to 6,261.
IN THE PAPERS
Altice, a cable TV group controlled by Franco-Israeli billionaire Patrick Drahi, has struck a US$17.7bn takeover deal for US group Cablevision, the Financial Times reports.
The FT also highlights strengthening competition for cab app Uber. It reports that Uber’s main competitors in America and China respectively - Lyft and Didi Kuaidi – signed an alliance deal which lets their customers use the others services.
In a separate article the FT reports that French ‘ride sharing’ app firm BlaBlaCar has just raised US$200mln in a venture capital funding round, which has valued the tech-firm at €1.4bn.
MPs have called for a Serious Fraud Office probe into Lloyds Bank and one of its property advisors in relation to potential abuses of the insolvency process, The Times says.
The Times also says Serco has lost £100mln after selling an Indian call centre business it acquired back in 2011.
Britain is facing a diesel drought, according to The Telegraph, which says a surge in diesel car sales and fewer UK refineries means the country is increasingly dependent on foreign imports of the fuel.
The Telegraph also highlights that News Corp has sealed its £114mln deal to acquire advertising platform Unruly.