London pre-open: Stocks to fall as Chinese data disappoints

LONDON (ShareCast) - Stocks are expected to edge lower on Wednesday after a raft of weak economic data from China, including figures that showed economic growth slowed to a six-year low in the first quarter. Investors were also likely to show caution with markets near record highs ahead of the European Central Bank (ECB) meeting in the afternoon.

City sources predict the FTSE 100 will open 13 points lower than Tuesday's close of 7,075.26. The index is continuing to fluctuate after setting a new all-time closing high of 7,089.77 last Friday.

Chinese gross domestic product expanded at an annual rate of just 7% in the first three months of 2015, in line with estimates but down from 7.4% growth in the fourth quarter.

An influx other economic data was also released in China overnight, showing that growth in fixed asset investment, industrial production and retail sales all eased in March.

"Whilst it is in line with expectations a little risk aversion has set into the markets overnight and this morning," said Angus Campbell from FxPro. "It is the industrial production and retail sales numbers that have worried investors causing Asian stocks to decline during their session," he said.

Stocks to watch High end fashion label Burberry said strong demand for its iconic heritage trench coats and scarves gave results a boost in the second half. Underlying revenues were up 9% year-on-year at £1.42bn in the six months to 31 March, though this was a slowdown from the 14% growth seen in the first half.

Astrazeneca (NYSE: AZN - news) gave US regulatory updates on two pipeline products, with a mixed review for its type-2 diabetes drugs after trial results that were deemed to have an acceptable risk profile but the gave rise to concerns about safety information. The FTSE 100 group's tremelimumab treatment for a rare and agrresive form of cancer has also been granted with the special 'orphan drug' status in the US, which should ease its path to full regulatory approval.

FTSE 250 energy services group Hunting (LSE: HTG.L - news) said operating profits were approximately 60% lower during the first quarter of 2015 compared to the same period last year. The group has cut employee levels 20% since the beginning of the year to cut costs as US oil inventory growth and rig count decline has slowed - but management remains of the opinion that capital investment and activity levels in the industry will recover as and when the supply/demand balance across the industry is resolved.