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London open: Stocks rise as investors digest jobs data
London stocks rose in early trade on Tuesday as investors mulled the latest UK jobs data.
At 0840 BST, the FTSE 100 was up 0.3% at 8,231.78.
Figures released earlier by the Office for National Statistics showed the unemployment rate fell unexpectedly in June.
The unemployment rate declined to 4.2% from 4.4% in May, coming in below expectations for a reading of 4.5%.
The data also showed that growth in average earnings excluding bonuses fell to 5.4% from 5.8% in May and versus expectations of 4.6%. This marked the slowest pace of growth since May to July 2022.
Including bonuses, average earnings grew 4.5% in June, down from 5.7% and below expectations of 4.6%.
Richard Hunter, head of markets at Interactive Investor, said the drop in average earnings was “promising news in the battle against inflation”.
He added: “The numbers go some way in justifying the Bank of England’s recent decision to cut interest rates given a relatively stable economy, although the timing and amount of the next cut is up for debate, swinging from a possible November reduction to nothing further this year at all.”
In equity markets, Just Group surged as it posted a 44% jump in underlying operating profit for the first half to £249m, which was ahead of consensus expectations. It also said it now expects to “substantially exceed” previous 2024 guidance of doubling 2021’s £211m operating profit in three years.
Specialty chemicals firm Synthomer also rose sharply after interim results.
Bridgepoint rallied after an upgrade to ‘overweight’ from ‘neutral’ at JPMorgan. “The current low circa 11x 2026E price-to-earnings is an attractive entry point, with the shares offering upside both from earnings growth and rerating potential,” JPM said in a research note.
On the downside, Flutter Entertainment slumped ahead of second-quarter results later in the day.
Dowlais lost ground as the GKN Automotive owner said it was considering a potential sale of its Powder Metallurgy business and that it now expects a decline in full-year revenue.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Standard Chartered Plc | +2.05% | +14.80 | 736.80 |
| 2 |  |
Wheaton Precious Metals Corp. | +1.93% | +85.00 | 4,490.00 |
| 3 |  |
Banco Santander S.a. | +1.89% | +6.50 | 350.00 |
| 4 |  |
Sainsbury (j) Plc | +1.63% | +4.40 | 274.00 |
| 5 |  |
Tesco Plc | +0.96% | +3.20 | 336.70 |
| 6 |  |
National Grid Plc | +0.92% | +9.00 | 987.40 |
| 7 |  |
Jd Sports Fashion Plc | +0.91% | +1.10 | 121.45 |
| 8 |  |
Admiral Group Plc | +0.78% | +21.00 | 2,719.00 |
| 9 |  |
Gen.acc.8se.pf | +0.71% | +1.00 | 142.75 |
| 10 |  |
Carnival Plc | +0.58% | +6.00 | 1,043.50 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Flutter Entertainment Plc | -4.12% | -605.00 | 14,080.00 |
| 2 |  |
Antofagasta Plc | -2.42% | -45.50 | 1,834.00 |
| 3 |  |
Marks And Spencer Group Plc | -1.95% | -6.30 | 316.90 |
| 4 |  |
Spirax Group Plc | -1.69% | -130.00 | 7,585.00 |
| 5 |  |
Glencore Plc | -1.19% | -4.90 | 405.35 |
| 6 |  |
Smith & Nephew Plc | -1.17% | -13.50 | 1,142.50 |
| 7 |  |
Wpp Plc | -1.16% | -8.00 | 682.20 |
| 8 |  |
Anglo American Plc | -1.14% | -25.50 | 2,207.00 |
| 9 |  |
Vodafone Group Plc | -0.97% | -0.72 | 73.72 |
| 10 |  |
Smurfit Westrock Plc | -0.92% | -28.00 | 3,030.00 |
US close: Stocks mixed ahead of key inflation reports
Wall Street delivered a mixed performance on Monday as market participants looked ahead to key inflation data due out later in the week.
At the close, the Dow Jones Industrial Average was down 0.36% at 39,357.01, while the S&P 500 was flat at 5,344.39 and the Nasdaq Composite saw out the session 0.21% firmer at 16,780.61.
The Dow closed 140.53 points lower on Monday after stocks almost completely reversed their violent sell-off from the start of last week.
This week’s primary focus will be the July producer price index on Tuesday and the July consumer price index on Wednesday, which may shed some light on whether or not markets have priced in the likelihood of a 50 basis point reduction in the Federal Reserve rate at its next policy meeting in September.
In the corporate space, KeyCorp surged after Bank of Nova Scotia agreed to invest $2.8bn in the lender, while Starbucks also traded higher following a Wall Street Journal report that revealed activist investor Starboard Value has now taken a stake in the coffee chain.
On the macro front, the US Federal Government budget deficit expanded 10% year-on-year to $244.0bn in July, above estimates of $242.0bn.
Tuesday newspaper round-up: Telegraph, UK offices, China
The Treasury has sought to defuse a bitter row with the North Sea oil and gas industry by promising to keep investment reliefs on low-carbon projects, aiming to protect jobs and soften the expansion of the energy windfall tax. The chancellor, Rachel Reeves, said last month that she would expand the levy on energy industry profits as part of her plan to plug a £22bn “hole” in the public finances that Labour said had been left by the previous Conservative government. – Guardian
The UK’s biggest housing association has been fined after a watchdog found that its failure to carry out repairs to a child’s bedroom window for four years left the home mouldy and caused serious illness in the family that lived there. Clarion housing association showed “no urgency” to fix the window, instead leaving it boarded up, despite repeated complaints from the tenant who said the mould caused his asthma to flare up and affected his son’s mental health. – Guardian
Boris Johnson has held talks about a role at The Telegraph as part of former Tory chancellor Nadhim Zahawi’s takeover bid. The former prime minister had informal discussions with Mr Zahawi, who is assembling a consortium to buy The Telegraph as part of an auction process, about a possible job if he is successful. – Telegraph
Offices in the UK are selling for almost a fifth less than what their owners were hoping they would fetch, the biggest discount since the global financial crisis 15 years ago. In a sign of how tepid demand is, especially for older and less eco-friendly blocks, buyers of offices this year have on average paid 18 per cent less than the asking price, data from CoStar, the property analytics group, shows. – The Times
Investors pulled a record amount of cash out of China in the second quarter of this year amid concerns about the health of the world’s second-largest economy, official data showed. In the three months to June, outflows of investor capital from China reached $15 billion, according to balance of payments figures published by the State Administration of Foreign Exchange last Friday. The numbers were first reported by Bloomberg. – The Times
