London stocks had popped into the black by midday on Tuesday, helped along by well-received earnings from the likes of BHP and Just Eat, as investors digested the latest UK jobs data.
The FTSE 100 was 0.2% higher at 7,164.80, reversing earlier losses.
Figures out earlier from the Office for National Statistics showed that job vacancies hit a record high in May to July amid staff shortages in many industries. Vacancies rose by 290,000 from the previous quarter to 953,000. This was a 168,000 increase compared to pre-pandemic levels between January and March 2020.
Meanwhile, the unemployment rate in the three months to June ticked down 0.2 percentage points to 4.7%.
The data showed that the number of payroll employees rose 182,000 to 28.9m in July. However, it remains 201,000 below pre-Covid levels. Average weekly pay growth rose to 8.8% in June from 7.4% in May, hitting the highest level since the series began in 2001 and coming in above the Bank of England’s forecast of 8.5%.
Ruth Gregory, senior UK economist at Capital Economics, said the rise in average weekly pay will fuel concerns on the Monetary Policy Committee (MPC) that higher CPI inflation will persist in 2022.
“Overall, we still think that the Bank of England won’t hike interest rates until mid-2023, rather than in mid-2022 as the markets expect. Today’s figures, however, suggest that the risks are tilted towards wage growth coming in a bit higher and the MPC raising rates a bit sooner than we anticipate,” she said.
Still to come on the macro front, market participants will eye the release of US retail sales figures for July at 1330 BST.
In equity markets, BHP surged to the top of the FTSE 100 after agreeing to sell its petroleum business to Australia’s Woodside Petroleum and posting a 42% jump in full-year net profit.
Food delivery giant Just Eat Takeaway.com gained after it posted a better-than-expected operating loss of €190m as it continued to invest in its businesses and said it had “reached the peak of absolute losses”.
Water pipe and ventilation group Genuit racked up healthy gains after it lifted full-year guidance and reported higher interim profits, boosted by acquisitions.
Online trading platform Plus500 rallied after it posted a dip in interim earnings and revenue as trading levels normalised, but said revenue for the year was set to be “significantly ahead” of current market forecasts.
On the downside, travel stocks were under the cosh again amid renewed concerns about the impact of the Delta variant, with Premier Inn owner Whitbread, British Airways parent IAG, InterContinental Hotels and Tui all weaker.
Insurer Beazley was knocked lower by a downgrade to ‘sell’ at UBS.
Market Movers
FTSE 100 (UKX) 7,164.80 0.15%
FTSE 250 (MCX) 23,774.50 0.26%
techMARK (TASX) 4,784.25 0.10%
FTSE 100 – Risers
BHP Group (BHP) 2,446.00p 7.26%
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,314.00p 2.93%
Fresnillo (FRES) 830.00p 2.19%
Rentokil Initial (RTO) 568.80p 1.50%
Scottish Mortgage Inv Trust (SMT) 1,338.50p 1.36%
Hikma Pharmaceuticals (HIK) 2,556.00p 1.35%
Ashtead Group (AHT) 5,670.00p 1.29%
Croda International (CRDA) 9,130.00p 1.15%
Tesco (TSCO) 244.55p 1.01%
Antofagasta (ANTO) 1,543.00p 0.95%
FTSE 100 – Fallers
Kingfisher (KGF) 352.40p -3.35%
Whitbread (WTB) 3,011.00p -2.87%
International Consolidated Airlines Group SA (CDI) (IAG) 160.60p -2.35%
InterContinental Hotels Group (IHG) 4,492.00p -2.07%
Land Securities Group (LAND) 718.20p -1.70%
Lloyds Banking Group (LLOY) 44.87p -1.67%
British Land Company (BLND) 524.40p -1.43%
Pearson (PSON) 767.20p -1.39%
Phoenix Group Holdings (PHNX) 662.60p -1.37%
BT Group (BT.A) 173.55p -1.36%
FTSE 250 – Risers
Plus500 Ltd (DI) (PLUS) 1,524.50p 6.65%
Genuit Group (GEN) 686.00p 5.86%
Vivo Energy (VVO) 108.60p 3.82%
Indivior (INDV) 178.40p 3.54%
PureTech Health (PRTC) 330.50p 2.96%
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,314.00p 2.93%
Hill & Smith Holdings (HILS) 1,802.00p 2.27%
Dechra Pharmaceuticals (DPH) 5,285.00p 2.22%
Ferrexpo (FXPO) 396.40p 2.16%
Discoverie Group (DSCV) 1,066.00p 2.11%
FTSE 250 – Fallers
Hammerson (HMSO) 34.46p -3.88%
TUI AG Reg Shs (DI) (TUI) 310.50p -3.84%
Harbour Energy (HBR) 329.40p -3.29%
Avon Protection (AVON) 2,058.00p -2.46%
Fidelity China Special Situations (FCSS) 343.50p -2.41%
Syncona Limited NPV (SYNC) 206.00p -2.37%
Beazley (BEZ) 405.40p -2.34%
Tullow Oil (TLW) 44.64p -2.32%
Cineworld Group (CINE) 61.32p -2.11%
Trainline (TRN) 346.60p -2.09%
