London pre-open: Stocks seen flat ahead of US election

(Sharecast News) - London stocks were set for a flat open on Monday as all eyes turned to the US election on Tuesday and policy announcements in the UK and the US this week. The FTSE was called to open unchanged at 8,177.

Kathleen Brooks, research director at XTB, said: "There is a formidable amount of event risk coming up for markets in the next few days, which will test the stamina of investors. The US election, economic data, earnings and two key central bank meetings.

"It looks like it will be a photo finish for this election. The RealClearPolitics poll average puts Kamala Harris ahead with 48.5% of the vote, while Donald Trump has 48.3%. The most recent New York Times/ Siena Survey shows that Harris is ahead in 5 of the 7 key swing states, however, her lead is still within the margin for error.

"Arizona is clearly leaning towards a Trump victory in this late stage of the campaign, while Wisconsin, Nevada and North Carolina look like they will swing to Harris. In Pennsylvania, the 'tipping point state', the polls for both candidates are neck and neck.

"The final rallies for both candidates were held in the key battleground states over the weekend. Some political commentators noted a shift in tone from Donald Trump, with some suggesting that he could be gearing up to contest the election.

"Global stock markets sold off last week, and the S&P 500 finished lower by more than 1%, although they rose on Friday. The main US blue chip index is up 20% YTD, which does not suggest that the market is seriously pricing in the risk of civic violence after this election, which could rock financial markets and cause a global wave of risk aversion."

In corporate news, Anglo American announced the A$1.6bn (£0.8bn) sale of a stake in the Jellinbah joint venture in Australia as part of its strategy to exit the steelmaking coal industry.

The mining group, which in the summer revealed plans to spin off or exit several businesses including its diamond, platinum and coking coal operations, said that it has offloaded its 33.3% interest in Jellinbah, which owns a 70% stake in the Jellinbah East and Lake Vermont steelmaking coal mines in Australia, to project partner Zashvin.

Chemring Group said it has secured £278m in contracts with its Norwegian subsidiary Chemring Nobel signing a €231m, 12-year framework agreement with Diehl Defence for supplying MCX energetic material over five years starting in 2026.

The FTSE 250 company said its US subsidiary Chemring Energetic Devices had meanwhile received a $106m order for missile program components, also with deliveries beginning in 2026. It said it expected its adjusted operating profit for the 2024 financial year to meet consensus forecasts of £70.9m.