London shares outlook - seen lower after late Wall Street pullback, BoE eyed

LONDON (AFX) - Leading shares are expected to open slightly lower today, starting the week on the back foot following a late pull-back by Wall Street on Friday night, while concerns over today's postponed Bank of England interest rate announcement is also likely to weigh on sentiment, dealers said.
According to spread-betting firm IG Index, the FTSE 100 is expected to start around 15 points lower at 4,903 after closing at 4,918.9 on Friday.
Over on Wall Street, US stocks finished mixed on Friday, pulling back in the final minutes of trade as worries about higher interest rates took some of the shine off a much stronger than expected April jobs report.
After rising as high as 10,400 intraday, the DJIA finished the day up just 5.02 points at 10,345.40, while the Nasdaq rose 5.55 points to close at 1,967.35.
Across Asia, the Nikkei 225 index began the afternoon session 58.81 points lower at 11,133.36, while the Hang Seng was 15.43 points lower at 14,018.53 by midday.
In the UK, today's main focus should be the BoE's latest interest rate decision at midday, pushed back until Monday because of last week's general election.
Although the Bank of England is widely expected to keep rates on hold for the ninth consecutive month, any accompanying statement will be closely eyed, as recent economic data has shown the health of the UK economy to be a mixed affair.
With UK earnings news slowing to a trickle this week, today's main points of interest look like being AGM statements from blue chips Centrica and Xstrata, while among smaller companies a trading update from Center Parcs and interim results from Richmond Foods should also provide some interest.
Elsewhere, investors and traders are expected to turn to broker comments and the weekend press for inspiration.
Royal Bank of Scotland shares should be active after the Observer newspaper reported yesterday that the group has stepped back from plans to buy a 20 pct stake in Bank of China for about 2 bln stg.
Sir Fred Goodwin, chief executive of RBoS, has reportedly bowed to shareholder concerns about making such a large investment in a Chinese firm whose operations are less than transparent, the sources said.
However, RBoS is still considering buying a small stake in Bank of China, perhaps 5 pct for about 400 mln stg, they added.
Remaining in the banking sector, the same newspaper reported that Barclays has finalised a 2.8 bln stg deal to acquire a 60 pct stake in South Africa's Absa.
The Financial Times noted that Barclays is set to announce the 2.9 bln acquisition today.
Kingfisher shares should also be in focus this morning after the Mail on Sunday reported yesterday that Home Depot, the US home improvement retailer, is considering launching a takeover for the UK group if it is willing to sell its French business.
Bob Nardelli, chairman and chief executive of Home Depot, reportedly discussed this plan at a recent meeting with Kingfisher chief executive Gerry Murphy and chairman Francis Mackay in London.
On the second line, shares in Manchester United should be in demand after the Sunday Telegraph reported that US sports tycoon Malcolm Glazer is to formally make an 800 mln stg bid for the football club this week.

Morning all,its about time that glazer bought them.

Good morning all. Anyone any vews on the Barclays/Absa deal?

The City seems to like the Barclays deal. I guess that's the important thing.

:-)

T Clarke only showing at 7% down on gainers/losers when it should be 67% down! Straight through my stop loss:-( News must have been worse than I thought, shall go and investigate now. Not a good day.

Oops, out of touch ......... bonus shares issued on CTO thus
explaining drop in price!

Glad you worked that one out jj50. But strangely, the intraday chart shows a massive drop in price just after 10am (from 660 down to 230). However, the sp opened this morning at the new level of 224 and all trades since have been in that ballpark. So why is the intraday chart out of step?

Starfrog, it is puzzling - Investors Intelligence was not alone in
marking it as the biggest loser of the day this evening either! It was close of day before comdirect tripled my holding but I had been out at the end of last week so was surprised when I saw the price collapse in front of my eyes this morning, despite a fairly positive statement from CTO. Doesn't explain intraday chart though!