UK Stocks - Factors to watch on Jan 4

 

Britain's FTSE 100 index is seen opening 21 to 24 points, or 0.5 percent, lower on Monday, the first session of 2010, according to financial bookmakers, mirroring a New Year's Eve drop on Wall Street, although firmer showings overnight in Asia should temper the falls.

The UK blue-chip index gained 15.02 points, or 0.3 percent, to end at 5,412.88 after its half-day trading session on Dec. 31, registering a 22 percent year-on-year increase for 2009, its biggest annualised gain since 1997.

Investors will eye the UK December CIPS manufacturing PMI report, due at 0928 GMT on Monday, with a reading of 52.0 expected, up from 51.8 in November.

November UK consumer credit, mortgage lending, and mortgage approval numbers will also be released at 0930 GMT.

Overall domestic attention will be on the first Bank of England interest rate decision of 2010, due at midday on Thursday, although no change is expected to the central bank's monetary or quantitative easing policies. The other main focus this week will be Friday's December U.S. jobs report, although ahead of that a batch of other data will also draw attention.

December's U.S. ISM manufacturing PMI report is due to be released at 1500 GMT on Monday, with a reading of 54.0 forecast, up from 53.6 in November, and November U.S. construction spending numbers are also due at 1500 GMT.

* GLOBAL MARKETS-Japan stocks, dollar up on U.S. jobs hopes

* US STOCKS-Wall St ends '09 with best gains since 2003

* Nikkei up as weaker yen boosts exporters; JAL soars

* FOREX-Dollar below 4-month high vs yen, U.S. data eyed

* TREASURIES-Fall in Asia on recovery hopes, rising stocks

* Oil climbs to $80, Russia oil halt to Belarus supports

* PRECIOUS-Gold wavers near $1,095, eyes U.S. data

* METALS-Copper opens new year up 1 pct, bullish trend stays

UK stocks to watch on Monday are:

CADBURY

Kraft Foods is preparing to sweeten its hostile 10 billion pound($15.9 billion) takeover bid for confectionery maker Cadbury, reported theSunday Times.

LLOYDS BANKING GROUP, ROYAL BANK OF SCOTLAND

Brazilian lender Itau Unibanco is considering buyingstakes in one of the two British banks rescued by the UK government during the global credit crisis of 2008, the Sunday Times said.

MARKS & SPENCER

M&S is expected to report a sales increase for the Christmas period for the first time in two years when it delivers its trading update on Wednesday, the Daily Telegraph said on Monday. Sales of food and clothing are believed to has risen by 1 percent over the 13 weeks to Dec. 26, compared with a 7 percent decline over the same period last year, the newspaper said.

BAE SYSTEMS

A pension fund may ask the U.S. Supreme Court to let it sue BAE Systems in the United States over allegations that the company paid more than $2 billion inbribes to win a record Saudi arms deal, the fund's lead attorney said on Friday

TULLOW OIL

Tullow Oil is considering a bid to acquire partner Heritage Oil's stake in two large oilfields in Uganda, the Sunday Times said. Heritage decided to sell its stakes for 1.5 billion dollars to Eni in November, but Tullow is lining up the necessary finance and has until Jan. 17 to exercise its option.

ITV

ITV's decision to sell Friends Reunited to Brightsolid, currently being scrutinised by regulators, is being backed by the National Archives, the government's official archive, which said the deal would create "more robust and serious competition" to Ancestry.com, the market leader based in the United States, the Financial Times said on Monday.

BANKS

Goldman Sachs has begun a review of its London operations that could result in entire departments going overseas to avoid paying increasing British taxes, the Daily Telegraph reported on Monday.

SILENCE THERAPEUTICS

The drugs maker holds an EGM to approve its merger with Intradigm Corp.