(Alliance News) - Stocks in London are set to open higher on Thursday, after US stocks staged somewhat of a rebound on Wednesday, despite lingering interest rate worries.

IG says futures indicate the FTSE 100 to open 9.7 points higher, 0.1%, at 7,947.14 on Thursday. The index of London large-caps closed up just 2.35 points at 7,937.44 on Wednesday.

The pound was quoted at USD1.2658 early Thursday, up from USD1.2630 late Wednesday. The euro stood at USD1.0846, rising from USD1.0827. Against the yen, the dollar was trading at JPY151.67, down from JPY151.72.

US stocks ended largely higher overnight. The Dow Jones Industrial Average fell 0.1%, the S&P 500 rose 0.1% and the Nasdaq Composite added 0.2%.

The US Federal Reserve's high benchmark rate is "doing its job" against elevated inflation, Chair Jerome Powell said Wednesday, warning that lowering it too soon could be "quite disruptive" for the American economy.

The US central bank has held interest rates at a 23-year high of between 5.25% and 5.50% as it seeks to bring inflation firmly down to its long-term target of 2%.

Last month, Fed policymakers pencilled in three rate cuts for this year, staying the course despite a recent uptick in inflation which has disrupted recent progress against rising prices.

Powell told a conference in California that the current risks to the US economy were "two-sided," with negative consequences for the economy if policymakers moved to cut rates too fast or too slow.

"The risk, though, of moving too soon, really is.. that inflation does move up," he said, adding it "would be quite disruptive if we were to have to then come back in."

But if the US economy continues to evolve as expected, most Fed participants still expect it will be "appropriate to begin lowering the policy rate at some point this year," he said.

That comment boosted gold. Gold broke above USD2,300 for the first time Thursday. The precious metal has chalked up multiple records over recent weeks as the US Federal Reserve indicates it is about to begin easing monetary policy – which makes it more attractive to investors.

Its popularity as a safe haven in times of turmoil has also provided plenty of support, with traders fretting over the Middle East crisis and the ongoing war in Ukraine.

Gold was quoted at USD2,297.62 early Thursday UK time, rising from USD2,286.90 at the time of the London equities close on Wednesday. It had spiked to USD2,304.89 earlier on Thursday. Brent oil was quoted at USD89.55, easing slightly from USD89.69.

In Tokyo on Thursday, the Nikkei 225 rose 1.0%, while the S&P/ASX 200 in Sydney added 0.5%. Financial markets will be closed in Hong Kong and Shanghai were closed for Tomb Sweeping Day.

The economic calendar has a producer price reading from the eurozone at 1000 BST, as well as a slew of composite purchasing managers' index readings, including the UK at 0930 BST. The latest US jobless claims reading is at 1330 BST.

By Eric Cunha, Alliance News news editor

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