Sharecast - The FTSE 100 was called to open 20 points lower at 7,768, amid an avalanche of earnings.
CMC Markets analyst Michael Hewson said: "Last night’s market reaction to the Federal Reserve's 25 bps rate hike was a relatively benign one with US stocks finishing the day lower on disappointment that Powell ruled out the prospect of rate cuts soon, although the fall in yields suggests that bond markets believe they are coming.
"European markets managed to finish the day cautiously higher, although the gains were modest compared to the declines seen the day before. In light of yesterday’s negative US finish, today’s open looks set to be a negative one."
US banks will be in focus again after PacWest Bancorp tumbled 50% in after-hours trading as it said it was considering its strategic options, including a sale.
In UK corporate news, oil giant Shell (LON:RDSa) beat forecasts to post a first-quarter net profit of $9.65bn, although down 2% year-on-year due to lower oil and gas prices.
Cash flow from operating activities for the first quarter 2023 was $14.2bn, down 37%, and included a working capital outflow of $0.8bn and tax payments of $3.1bn.
Continuing surging oil company profits, driven by higher prices, have reignited calls for a further strengthening of windfall taxes by the UK government as consumers struggle with the cost-of-living crisis and soaring inflation.
Shell held its dividend at $0.2875 per share. Earnings beat a company-provided forecast of $8bn.
Challenger bank Virgin Money (LON:VMUK) posted lower first-half profit due to an increase in impairment charges for bad debts and higher investment costs.
The bank posted pre-tax profits of £236m compared with £315m a year earlier. Provision for bad debt surged to £144m from £21m, as Virgin updated economic assumptions with some signs of a modest increase in arrears on customer credit cards.
Higher interest rates drove an improvement in income to £933m, up 10%, while the bank’s net interest margin - the difference between what it charges for loans and pays on deposits - grew by eight basis points to 1.91%.
