London close: Stocks mixed as US jobless claims fall

London stocks finished in a mixed state on Thursday as investors thumbed their way through the latest US jobless claims, although GKN owner Melrose remained a high riser after well-received results.

The FTSE 100 ended the session up 0.2% at 7,163.90, while the FTSE 250 was 0.1% weaker at 24,226.27.

Sterling was in the green, last trading 0.41% higher on the dollar at $1.3826, and gaining 0.21% on the euro to €1.1657.

“US markets are leading the push higher today, as a marginal beat in the jobless claims reading did help allay some of the fears brought about after a disappointing ADP payrolls release yesterday,” said IG senior market analyst Joshua Mahony.

“With tapering set to remain a key concern in the coming months, the hope is that any short-term economic volatility brought about by rising Delta cases could cause hesitation from the Federal Reserve.”

Record highs in the US appeared to be an “almost daily” occurrence, Mahony said, with the prospect of a cautious approach to tightening at the Fed providing a “fresh bout of confidence” from the bulls.

“This latest push higher has been driven in part by the tech sector, with Apple gains helping to lift the Dow and Nasdaq in particular.”

Across the Atlantic, the number of Americans filing for unemployment claims continued to drop at the end of August, with the Department of Labor reporting that initial jobless claims fell by a seasonally-adjusted 14,000 in the week ended 28 August to reach 340,000.

That was just as expected by economists at Barclays, and marked the lowest level since 14 March last year.

On a four-week moving average basis, which smooths out the volatility in the data from one week to the next, jobless claims declined by 11,750 to 355,000.

Secondary unemployment claims, which are those not being filed for the first time and reference the week ending on 21 August, retreated by 160,000 to approximately 2.75m.

That too was the lowest tally since March 2020, although back then they were at 1.77m.

Back in Britain, visits to shops improved in August by around a quarter, according to fresh data released on Thursday, with footfall being 18.6% below pre-pandemic levels in 2019 in August, compared to the 24.2% gap in July.

Retail analysis outfit Springboard said the gap from the 2019 footfall level reduced to less than 20% for the first time since the start of the Covid-19 pandemic.

Footfall declined from 2019 by 23.5% in high streets, 24% in shopping centres, and just 2.4% in retail parks, with the popularity of domestic holidays, or ‘staycations’, as well as so-called ‘daycations’ in August bolstering footfall, particularly in high streets.

“It seems that the popularity of staycations and daycations in August bolstered footfall activity, particularly in high streets,” said Springboard marketing and insights director Diane Wehrle.

“Despite restrictions being lifted for overseas travel, it is clear that Brits chose to stay home for the summer which gave a welcome boost to high streets and particularly those that are attractive visitor destinations such as coastal and historic towns.”

In equity markets, ex-dividend stocks were a drag, with Admiral Group down 3.83%, BHP losing 5.56%, and Centamin 5.14% weaker.

Housebuilder Barratt Developments was in the red by 4.5% even after it reported a 65% jump in full-year profit amid “strong demand”.

In the year ended 30 June, pre-tax profit rose to £812.2m from £491.8m the year before, with revenues up 40.7% at £4.8bn.

Total completions, meanwhile, were 36.8% higher at 17,243.

Online trading platform CMC Markets tumbled 27.38% after cutting its full-year earnings outlook as it highlighted subdued trading and reduced market volatility.

The company now expected 2022 financial year net operating income of between £250m and £280m, down from previous guidance of in excess of £330m.

Auction Technology slid 10.23% after TA Associates and ECI Partners sold around 12.6m shares in the company in a placing.

The shares were sold to institutional investors by way of an accelerated bookbuild at a price of 1,500p each, raising around £189m.

On the upside, Melrose Industries rallied 7.19% after saying it was trading ahead of expectations as the turnaround company reported a narrower loss for the first half of 2021.

The company reported a statutory pre-tax loss of £151m for the six months to the end of June compared with a £585m loss a year earlier as revenue rose to £3.54bn from £3.39bn.

Energean advanced 7.27% after it said production was outperforming guidance as the gas explorer reported its first set of results including a full contribution from the acquisition of Edison's oil and gas business.

HomeServe was boosted 3.34% by an upgrade to ‘overweight’ from ‘equalweight’ at Barclays.

Market Movers

FTSE 100 (UKX) 7,163.90 0.20%
FTSE 250 (MCX) 24,226.27 -0.10%
techMARK (TASX) 4,857.15 0.09%

FTSE 100 - Risers

Melrose Industries (MRO) 184.24p 7.19%
Prudential (PRU) 1,536.50p 3.75%
Weir Group (WEIR) 1,792.00p 3.12%
BP (BP.) 299.90p 1.92%
Royal Dutch Shell 'A' (RDSA) 1,455.40p 1.90%
Royal Dutch Shell 'B' (RDSB) 1,450.60p 1.90%
Evraz (EVR) 596.60p 1.88%
Spirax-Sarco Engineering (SPX) 16,630.00p 1.84%
Royal Mail (RMG) 494.60p 1.83%
Intermediate Capital Group (ICP) 2,293.00p 1.60%

FTSE 100 - Fallers

BHP Group (BHP) 2,107.00p -5.56%
Barratt Developments (BDEV) 709.40p -4.50%
BT Group (BT.A) 161.85p -3.85%
Admiral Group (ADM) 3,488.00p -3.83%
B&M European Value Retail S.A. (DI) (BME) 540.00p -2.70%
Taylor Wimpey (TW.) 177.80p -2.44%
Persimmon (PSN) 2,876.00p -2.08%
Unilever (ULVR) 3,965.00p -2.05%
Next (NXT) 7,928.00p -1.91%
Associated British Foods (ABF) 1,964.50p -1.77%

FTSE 250 - Risers

Energean (ENOG) 730.00p 7.27%
Helios Towers (HTWS) 181.60p 4.25%
IP Group (IPO) 143.40p 3.76%
Rotork (ROR) 344.40p 3.49%
Homeserve (HSV) 990.00p 3.34%
Hays (HAS) 163.20p 3.09%
Ashmore Group (ASHM) 394.80p 2.28%
Aston Martin Lagonda Global Holdings (AML) 2,026.00p 2.22%
Biffa (BIFF) 395.00p 2.06%
Hill & Smith Holdings (HILS) 1,894.00p 2.05%

FTSE 250 - Fallers

CMC Markets (CMCX) 305.00p -27.38%
IG Group Holdings (IGG) 840.00p -11.01%
Auction Technology Group (ATG) 1,474.00p -10.23%
Centamin (DI) (CEY) 95.10p -5.14%
Plus500 Ltd (DI) (PLUS) 1,416.00p -3.84%
Mitie Group (MTO) 74.50p -3.62%
888 Holdings (888) 407.00p -3.55%
Syncona Limited NPV (SYNC) 192.20p -3.51%
PureTech Health (PRTC) 341.00p -3.12%
Petropavlovsk (POG) 22.00p -3.00%