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01 Feb 2021 | 07:32

London pre-open: Stocks seen higher as investors mull China PMIs

(Sharecast News) - London stocks were set to rise at the open on Monday, taking their cue from a positive session in Asia as investors mull the latest Chinese PMI data. The FTSE 100 was called to open 19 points higher at 6,426.

CMC Markets analyst David Madden said: "At the weekend, China announced its official manufacturing PMI and non-manufacturing PMI reports. The manufacturing reading for January was 51.3, slightly ahead of economists' forecasts, but it cooled from the 51.9 posted in the previous update. The non-manufacturing update was 52.4, down from 55.7 in December. Overnight, the Caixin survey of Chinese manufacturing was 51.5, while economists were expecting 52.6. The December reading was 53.

"Even though US index futures initially traded lower last night, sentiment changed. Equity markets in Asia are showing solid gains and European indices are called higher too."

Madden pointed to the fact that Reddit retail traders are now targeting silver prices. "Silver shone last week and overnight as the metal saw a rise in demand thanks to postings on Reddit - it was targeted like Gamestop. Gold was given a lift too," he said.

In corporate news, JD Sports Fashion has agreed to buy DTLR Villa, a US sports retailer, for $495m (£360m) of which about $100m will be used to repay debt. DTLR has 247 stores in 19 states, mainly in the north and east of the US.

Online fashion retailer Asos has bought four brands from the collapsed Arcadia group for £330m, administrators said.

The deal includes Topshop, Topman, Miss Selfridge and HIIT brands to Asos, but not physical stores, Deloitte said in a statement. Asos will pay around £295m for the brands, goodwill and stock on hand, and also take on liabilities for forward committed stock orders.
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