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London open: Stocks fall as investors mull jobs data; Centamin surges
London stocks fell in early trade on Tuesday as investors mulled the latest UK jobs data.
At 0855 BST, the FTSE 100 was down 0.4% at 8,236.36.
Figures released earlier by the Office for National Statistics showed pay growth cooled in the three months to July, while the unemployment rate fell to a six-month low.
The unemployment rate declined to 4.1% from 4.2% in the previous three months, in line with economists’ expectations.
Meanwhile, growth in average earnings fell to 5.1%, hitting a two-year low. Annual growth including bonuses was 4%.
The data also showed that in June to August, the estimated number of vacancies fell by 42,000 on the quarter to 857,000. This marked the 26th consecutive quarterly decline but still left vacancies above pre-Covid levels.
Meanwhile, estimates for payrolled employees were down 6,000 between June and July, but rose by 203,000 on an annual basis.
Liz McKeown, director of economic statistics at the ONS, said: “Growth in total pay has slowed markedly again as one-off payments made to many public sector workers in June and July last year continue to affect the figures.
“Basic pay growth also continued to slow, though less sharply.
“When taken together on a comparable basis, our different measures all show growth in the number of employees over the latest quarter, though annual growth has slowed over the year.
“Meanwhile, there was a decrease in the number of self-employed people and a fall in both those looking for a job and not looking for or available to start working.”
Russ Mould, investment director at AJ Bell, said: “The latest UK jobs fires suggest a labour market which, like a newly baked cake set in front of a group of kids, is cooling, but not quite as fast as the Bank of England might want in order to press the accelerator on rate cuts.
“UK wage growth fell to its lowest level since the quarter to July 2022 but, even in real terms, pay is still up considerably more than the Bank’s 2% inflation target. Although most of the data was in line with expectations, a tick lower in the unemployment rate and a much bigger increase in the number of people in employment does hint at some continuing tightness in the jobs market. This leaves the Bank’s decision making finely balanced ahead of its meeting next week.
“The ONS acknowledges some volatility around its numbers and this is not the only jobs data out this week with the accountancy group BDO releasing data suggesting August was the worst month for the UK labour market since 2013.
“Another significant takeaway from today’s ONS report is the 4% increase in overall wages which will feed into the uplift in the state pension. The increase will be less than pensioners have seen in recent years.”
In equity markets, gold miner Centamin surged more than 20% after it agreed to be taken over by AngloGold Ashanti in a £1.9bn deal.
Under the terms of the transaction, Centamin shareholders will receive 0.06983 new AngloGold Ashanti shares and $0.125 in cash. The price represents a premium of around 36.7% to the closing share price on Monday.
Hochschild Mining also gained, along with Fresnillo.
Wickes rallied as it posted a drop in interim profit as revenues fell, but backed its profit expectations for the year and said trends were improving.
On the downside, Alpha Group tumbled as it said Morgan Tillbrook had decided to step down as chief executive on 31 December. He will be succeeded by Clive Kahn, who has been chairman since 2016, and who will be appointed as CEO from 1 January 2025.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Wise Plc | +1.35% | +8.50 | 640.00 |
| 2 |  |
Flutter Entertainment Plc | +1.11% | +185.00 | 16,835.00 |
| 3 |  |
Jd Sports Fashion Plc | +1.10% | +1.50 | 137.35 |
| 4 |  |
Pershing Square Holdings Ltd | +0.74% | +26.00 | 3,532.00 |
| 5 |  |
Experian Plc | +0.65% | +24.00 | 3,714.00 |
| 6 |  |
Rentokil Initial Plc | +0.64% | +3.00 | 475.10 |
| 7 |  |
National Grid Plc | +0.58% | +6.00 | 1,041.50 |
| 8 |  |
Crh Plc | +0.53% | +34.00 | 6,426.00 |
| 9 |  |
International Consolidated Airlines Group S.a. | +0.44% | +0.85 | 192.25 |
| 10 |  |
Ck Infrastructure Holdings Limited | +0.44% | +2.50 | 575.00 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Astrazeneca Plc | -4.48% | -570.00 | 12,142.00 |
| 2 |  |
Centrica Plc | -1.92% | -2.35 | 120.15 |
| 3 |  |
Banco Santander S.a. | -1.88% | -7.00 | 365.50 |
| 4 |  |
Croda International Plc | -1.44% | -57.00 | 3,915.00 |
| 5 |  |
Smurfit Westrock Plc | -1.36% | -47.00 | 3,400.00 |
| 6 |  |
Pearson Plc | -1.28% | -13.50 | 1,045.00 |
| 7 |  |
Smith (ds) Plc | -1.18% | -5.40 | 452.60 |
| 8 |  |
Ferguson Enterprises Inc. | -1.04% | -150.00 | 14,250.00 |
| 9 |  |
Bp Plc | -0.80% | -3.25 | 403.40 |
| 10 |  |
Bhp Group Limited | -0.76% | -15.00 | 1,959.00 |
US close: Dow Jones reclaims Friday’s losses
Wall Street stocks closed higher on Monday as major indices tried to right the ship after a brutal first week of September trading.
At the close, the Dow Jones Industrial Average was up 1.20% at 40,829.59, while the S&P 500 advanced 1.16% to 5,471.05 and the Nasdaq Composite saw out the session 1.16% firmer at 16,884.60.
The Dow closed 484.18 points higher on Monday, erasing losses recorded in the previous session as market participants digested July’s all-important nonfarm jobs report, which revealed nonfarm payrolls grew by just 142,000, missing the 161,000 gain expected by economists.
As far as the new week was concerned, investors will look ahead to two key inflation reports that could further influence the Federal Reserve’s thinking ahead of its open market committee meeting later in the month, with August consumer and producer price reports slated for release on Wednesday and Thursday morning, respectively.
On the macro front for Monday, US wholesale inventories rose 0.2% month-on-month to $903.5bn in July, according to the Census Bureau, slightly below preliminary estimates for a 0.3% increase and following June’s flat reading. Non-durable stocks gained 0.5%, while durable goods grew 0.1%. Year-on-year, wholesale inventories grew by 0.4%, down from the advance estimate of 0.6%.
Elsewhere, total consumer credit surged $25.45bn in July, according to the Federal Reserve, significantly higher than the $12.5bn increase expected by economists and well above the $5.23bn increase recorded a month earlier for the largest credit growth since November 2022.
In the corporate space, shares in software giant Oracle surged following the publication of its first-quarter earnings.
Tuesday newspaper round-up: Water bills, iPhones, council tax, Audi factory
Rachel Reeves is being urged by a left-of-centre thinktank to announce changes to capital gains tax, inheritance tax and national insurance in next month’s budget that would raise more than £20bn a year for the Treasury. With the chancellor looking for ways to plug a £22bn hole that she has identified in the public finances, the Resolution Foundation said it was a time-honoured tradition that taxes were raised in the first budget after an election. – Guardian
Tuesday is the day water bills will start servicing debt and paying shareholders rather than fixing leaks and ending the sewage scandal, campaigners have said, dubbing it “cost of water privatisation day”. The public services campaign group We Own It has shared analysis from the University of Greenwich that reveals roughly 31% of money collected from water bills goes towards shareholders and paying off debts. Last financial year, an average of 11% of revenue was spent on dividends and 20% went towards servicing debts, while as of 10 September 31% of 2024 remains. – Guardian
iPhone users will be able to tell if they are losing their hearing after Apple launched a medical-grade audio test to its headphones. A software update to the company’s Airpods Pro wireless headphones will introduce a test measuring their decibel hearing levels. If the test determines that users are losing their hearing, the headphones will be able to function as a hearing aid, boosting voices in busy face-to-face conversations and phone calls. – Telegraph
Four million pensioners living alone are at risk of a council tax raid under Angela Rayner at the same time as they face losing winter fuel payments. Retirees make up around half of the 8.4m people who will be affected if the Housing Secretary abolishes a council tax break for one-person households, analysis shows. Ms Rayner, the Housing Secretary, this week refused to rule out scrapping the 25pc sole occupier discount, which cuts around £543 per year from the average Band D council tax bill in 2024-25. – Telegraph
Workers at an Audi factory in Brussels have stolen the keys to around 200 new cars at the plant in a show of anger at plans potentially to close the site. It is a further blow to Volkswagen, Audi’s parent company, which has announced that it is considering plant closures in Germany, and to the wider German automotive industry, for years renowned as the proud engine of the country’s economy and envied for possessing skilled engineers with an iron work ethic. – The Times
