London pre-open: Stocks seen flat as investors mull inflation data

(Sharecast News) - London stocks were set for a flat open on Wednesday as investors mulled the latest UK inflation figures.

The FTSE 100 was called to open unchanged at 8,767.

Data released earlier by the Office for National Statistics showed that the annual rate of consumer price inflation rose to 3% in January from 2.5% the month before, versus expectations for a smaller uptick to 2.8%.

On a monthly basis, CPI fell 0.1% last month, compared with a 0.6% fall in January 2024.

The ONS said the largest upward contribution to the monthly and annual changes came from transport, and food and non-alcoholic beverages, while the largest downward contribution came from housing and household services.

Ruth Gregory, deputy chief UK economist at Capital Economics, said the climb in inflation will be "uncomfortable" for the Bank of England.

"We doubt this will prevent the Bank of England from cutting interest rates further. But it will mean it continues to cut rates only slowly," she said.

In corporate news, HSBC's fourth-quarter profits exceeded analysts' estimates and the lender announced that it was planning to start a share buyback programme of as much as $2.0bn.

HSBC's profit hit $197m over the three months ending in December. That compared to a $153m loss one year before and a Visible Alpha estimate of $27.9m.

Glencore reported a fall in annual core earnings due to weaker commodities prices but said it would still return $2.2bn to shareholders via dividends and a buyback.

The miner and trader said adjusted earnings before interest, tax, depreciation and amortisation fell 16% to $14.36bn last year. Analysts had been expecting $14.55bn.