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London open: Stocks nudge up ahead of payrolls
London stocks nudged higher in early trade on Friday as investors eyed the release of the latest US non-farm payrolls report.
At 0820 GMT, the FTSE 100 was up 0.1% at 7,521.02.
The payrolls report for November is due at 1330 GMT, along with the unemployment rate and average earnings.
CMC Markets analyst Michael Hewson said: “Expectations are for 183k jobs to be added in November; however, it should also be remembered that a lot of additional hiring takes place in the weeks leading up to Thanksgiving and the Christmas period which might see the numbers come in higher.
“Whatever number we get it would be a big surprise to see any evidence of cracking in the US labour market this side of 2024, with labour force participation set to remain unchanged at 62.7%, and the unemployment rate at 3.9%.”
In equity markets, Sainsbury’s was boosted by an upgrade to ‘buy’ from ‘neutral’ at Goldman Sachs.
Building materials distributor Grafton Group rallied after saying it has extended its share buyback programme to end of May 2024, having initially set it to expire at the end of January.
Online trading platform IG Group rose as it announced the appointment of Breon Corcoran – the former chief executive of Paddy Power Betfair- as its new CEO.
Paddy Power owner Flutter edged up as it confirmed it was working towards a listing on the New York Stock Exchange in January but also that it will not be de-listing from London.
On the downside, miner Anglo American was under the cosh after saying it aimed to cut operational costs by around $1bn by the end of 2024, reducing production by about 4% as near-term constraints and volatile market conditions continued to weigh on earnings.
Imperial Brands was knocked lower by a downgrade to ‘sector perform’ from ‘outperform’ at RBC Capital Markets, which pointed to strong outperformance relative to British American Tobacco.
Housebuilder Berkeley Group fell after saying it has decided not to invest in any new developments due to the adverse planning and regulatory environment, and instead focus on “financial strength” following a rise in profits in the first half.
Pre-tax profit in the six months to 31 October increased by 4.6% to £298m, as operating margins held steady at 19.5%. However, the value of reservations dropped by a third due to the impact of elevated interest rates and ongoing “elevated political and macro volatility”, the company said.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Ocado Group Plc | +3.84% | +23.60 | 638.60 |
| 2 |  |
Antofagasta Plc | +2.96% | +43.00 | 1,495.50 |
| 3 |  |
Sainsbury (j) Plc | +2.86% | +8.30 | 298.40 |
| 4 |  |
Burberry Group Plc | +2.73% | +40.50 | 1,521.50 |
| 5 |  |
Ashtead Group Plc | +2.60% | +127.00 | 5,012.00 |
| 6 |  |
Carnival Plc | +2.47% | +31.00 | 1,288.00 |
| 7 |  |
Prudential Plc | +2.08% | +18.20 | 892.20 |
| 8 |  |
Hargreaves Lansdown Plc | +1.92% | +14.20 | 753.20 |
| 9 |  |
Intercontinental Hotels Group Plc | +1.67% | +110.00 | 6,700.00 |
| 10 |  |
Tui Ag | +1.64% | +10.00 | 619.50 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Anglo American Plc | -4.38% | -97.50 | 2,127.00 |
| 2 |  |
Smith (ds) Plc | -2.39% | -7.30 | 297.70 |
| 3 |  |
Berkeley Group Holdings (the) Plc | -2.15% | -106.00 | 4,834.00 |
| 4 |  |
Imperial Brands Plc | -1.64% | -30.50 | 1,826.00 |
| 5 |  |
Hiscox Ltd | -1.05% | -11.00 | 1,039.00 |
| 6 |  |
Barratt Developments Plc | -1.03% | -5.60 | 536.40 |
| 7 |  |
Mondi Plc | -0.77% | -11.50 | 1,474.00 |
| 8 |  |
Sse Plc | -0.70% | -13.00 | 1,857.00 |
| 9 |  |
Direct Line Insurance Group Plc | -0.69% | -1.35 | 194.35 |
| 10 |  |
Hikma Pharmaceuticals Plc | -0.62% | -11.00 | 1,772.00 |
US close: Stocks rise ahead of non-farm payrolls
Wall Street stocks closed higher on Thursday, with the market finding optimism in fresh labour market indicators, fueling expectations of a potential interest rate cut from the Federal Reserve.
At the close, the Dow Jones Industrial Average was up 0.17% at 36,117.38 points, while the broader S&P 500 index rose 0.8% to settle at 4,585.59.
The tech-heavy Nasdaq Composite posted even stronger gains, jumping 1.37% to finish at 14,339.99.
In currency markets, the dollar was last 0.06% stronger on sterling, trading at 79.45p, while it edged up 0.01% against the euro to 92.65 euro cents.
Meanwhile, the greenback held steady on the yen, trading at JPY 144.13.
“US stocks are trading modestly higher Thursday, led by outperformance in tech stocks, as investors position ahead of Friday’s payrolls report and on the back of a series of benign employment data,” said SPI Asset Management managing partner Stephen Innes.
“The forthcoming jobs report is expected to be a significant factor, but its expectations to convey a strong or hawkish message have been set relatively high.
“Given the risk-friendly tone from a series of tier-two employment data, it would be challenging to interpret the report as hawkish unless it delivers a blockbuster-type number.”
Jobless claims inch higher amid gradual slowdown
In economic news, American workers filed slightly more unemployment benefit claims in the week ended 2 December, reflecting a gradual slowdown in the labour market amid reduced demand.
According to the latest report from the Labor Department, initial jobless claims increased by 1,000 to reach a seasonally adjusted 220,000.
Economists’ expectations had leaned toward a slightly larger uptick, with a consensus forecast of 222,000.
Continuing claims took a dip, declining by 64,000 to 1.86 million.
The four-week moving average, intended to provide a more stable view of the jobless situation, increased by 500 to 220,750.
Notable spikes in unemployment claims were seen in California, New York, and Texas.
“Investors hoping for some further clues as to the state of the US labour market were left empty-handed by today’s claims figures,” said IG chief market analyst Chris Beauchamp.
“These continue to hover around the 220,000 mark, providing no hint that there is any real weakening in the American employment picture.
“Barring a shock payroll reading tomorrow, Wall Street seems to be in a holding pattern until the Fed decision next week.”
Tech stocks sparkle, Dollar General loses favour
In equity markets, chip giant Advanced Micro Devices (AMD) added 9.89%, following positive analyst reception to the company’s artificial intelligence event held earlier in the week.
Nasdaq-listed Cyngn skyrocketed 64% after it was granted a new patent related to autonomous vehicle and driving solutions.
Hempacco, the CBD hemp cigarette company listed on the Nasdaq Capital Market, also saw a substantial increase, rising 44.17%.
The surge came on the heels of the firm’s announcement of a distribution agreement in India and Thailand.
On the downside, Dollar General Corporation lost 1.21% despite reiterating its full-year guidance and posting a smaller-than-expected drop in quarterly sales.
The rural America-focused discount retailer reported a 1.3% decrease in like-for-like sales for the 13 weeks ended 3 November, which was better than the 2.1% fall analysts had expected.
Friday newspaper round-up: Anti-strike laws, recruiters, crypto kiosks
Rishi Sunak’s “spiteful” new anti-strike laws have created a “galvanising moment” for the UK’s trade union movement, the TUC general secretary has said. Speaking before a special congress of union leaders on Saturday about how to respond to the Strikes Act, Paul Nowak promised the TUC would throw its weight behind any worker hit by the new law. – Guardian
Britain’s largest recruiters have warned the Bank of England that demand for permanent hiring among UK businesses has plunged at the second fastest rate since the pandemic, amid worsening headwinds for the UK economy. Ahead of the central bank’s decision on interest rates on 14 December, the Recruitment and Employment Confederation (REC) trade body said lingering economic uncertainty and hesitancy to commit to new hires had weighed on activity in November. – Guardian
Sir Rocco Forte is planning a trip to Saudi Arabia next year to scout for hotel locations. The tycoon, whose £1.2bn group includes Brown’s Hotel in Mayfair and the Balmoral Hotel in Edinburgh, is eyeing a Middle Eastern expansion after inking a deal with Saudi Arabia’s sovereign wealth fund. Under the tie-up, the Public Investment Fund (PIF) is taking a 49pc stake in Rocco Forte Hotels, with Sir Rocco and his sister Olga Polizzi retaining the other 51pc. – Telegraph
The Financial Conduct Authority took more than three years to crack down on illegal crypto kiosks in Britain, according to an official report that raises concerns about the sluggish response of the regulator to new financial threats. The National Audit Office said “there can be a significant delay between the FCA identifying an issue and it taking action” and pointed to the failure to act quickly on so-called crypto automated teller machines as an example. – The Times
The billionaire hedge fund tycoon Sir Chris Hohn has awarded himself a £275 million dividend despite a near halving of annual profits at his investment firm. The $346 million payout from his TCI Fund Management Limited business follows a record $689.6 million dividend distributed by the group a year earlier, which was the biggest ever enjoyed by an individual based in the UK. While this year’s payout is significantly lower after volatile markets knocked TCI’s investment performance, Hohn nevertheless remains in the top ranks of Britain’s best-paid business figures. – The Times
