London pre-open: Stocks to edge up ahead of central bank meetings

(Sharecast News) - London stocks were set to edge up at the open on Monday ahead of a key week for central bank meetings. The FTSE 100 was called to open seven points higher at 7,561.

CMC Markets analyst Michael Hewson said: "As we look towards a new trading week, and probably the most consequential one this month, European markets look set to open slightly higher as investors look back at the inflation numbers from the weekend and extrapolate that 2024 may well be the year that rates start to come down, with the main risk being in overestimating by how far they fall."

The US Federal Reserve will make its latest policy announcement on Wednesday, followed by the Bank of England and the European Central Bank on Thursday.

Investors will also be mulling the latest data from Rightmove, which revealed that the housing market showed tentative signs of stabilising in December despite a further slide in house prices.

According to the Rightmove House Price Index, house prices fell by 1.9% this month. Prices normally dip in December, due to seasonal factors, but this year's fall was more than the previous 20-year average of a 1.5% decline.

Year-on-year, prices were just 1.1% lower, however.

The average asking price is now £355,177.

Rightmove said sellers were becoming more competitive with pricing as they looked to get homes sold in a "challenging" market.

But it also noted signs of more stable market conditions, as the market slowly shifted from "frenzy to normality", which should see more family movers returns. Many families shelved plans to move to bigger homes after last year's disastrous mini-budget sent mortgage rates soaring.

The number of agreed sales was down 13% on the same period last year, which Rightmove said was better-than-expected given that the 2022 market was "much more frenetic".

Tim Bannister, director of property science at Rightmove, said: "We entered this year under a cloud of uncertainty, as the fallout from the autumn mini-budget filtered through to lower activity levels.

"High mortgage rates, which have added to already-stretched buyer affordability, have been a challenge throughout 2023, and this is likely to carry into next year.

"However, for now there appears to be more calm and certainty heading into 2024, and the annual fall of 1.1% in asking prices highlights the market's much better-than-predicted resilience this year."

Average mortgage rates have been falling for the last four months, with the average 5-year fixed mortgage rate now 5.11%, compared to 6.11% in July.

In corporate news, troubled music rights investor Hipgnosis Songs Fund said it had sold around 20,000 songs for $23.1m, a 14.2% discount to valuation at the end of September.

"The non-core songs, require-time intensive ongoing accounting and reporting obligations and do not all have perpetual ownership rights," the company said in a statement, adding that the sale represents about 1% of the company's investment portfolio by value.

Net proceeds after costs are expected to be around $22.6m, and will be used to pay down debt "providing the company with greater headroom under its future covenant compliance reporting".

GSK has received marketing authorisation from the European Commission for 'Jemperli', or dostarlimab, in combination with chemotherapy for the treatment of adults with certain types of endometrial cancer, who need systemic therapy.

The FTSE 100 company said the approval also converted the previous conditional approval for Jemperli as a standalone treatment for similar patients who had progressed on platinum-containing therapy to full approval.