London close: Stocks rise a little as investors mull US jobs data

London stocks ended a little higher on Friday as investors mulled over the US jobs report and the latest goings-on in Westminster.

The FTSE 100 rose 0.2% to 7,282.34.

The payrolls release failed to have much of an impact. It showed a 130,000 increase in August compared to expectations of a 150,000 jump. Average hourly earnings rose 0.4%, giving a steady year-on-year rate of 3.2%, above consensus of 3% and the headline unemployment rate was steady at 3.7%, as expected.

Chris Beauchamp, chief market analyst at IG, said: "While ADP smashed expectations, today’s jobs report has been less encouraging, although far from a worrying reading. Overall it boosted neither the cause of lower rates, nor the case for tighter policy, and when the frequent August disappointment is factored in we should be careful about extracting too much meaning from today’s figures.

"Time and again in this cycle the US was thought to have been at full employment, only for new workers to be found, and today’s miss could well be revised away in coming months. However, the lack of pickup in wages would alarm the Fed if it did turn into a trend, especially when combined with any rise in inflation, should that ever happen (unlikely as it seems at present)."

In currency markets, the pound was 0.3% lower versus the dollar at 1.2302 and 0.4% lower against the euro at 1.1135, having surged to a five-week high on Thursday on expectations of a Brexit delay.

It appeared by the end of a tumultuous week in politics that Prime Minister Boris Johnson was not going to secure an early election on his terms, as opposition parties agreed not to his back his call for a snap election before the EU summit in mid-October.

Meanwhile, a bill to stop a no-deal Brexit was approved by both houses of Parliament and will now pass into law. It will mean that Johnson has to ask the EU for a Brexit deadline extension if he cannot agree a deal by 19 October.

Away from Brexit but still on home turf, investors digested the latest house price data from lender Halifax, which showed that prices ticked up a touch more than expected in August as a lack of supply helped to offset the impact of Brexit uncertainty.

Prices rose 0.3% on the month compared to a 0.4% increase in July, beating expectations for a 0.2% jump.

On the year, prices were up 1.8% compared to a 1.5% rise in July but falling well short of expectations for a 3.4% increase.

Managing director Russell Galley said the monthly increase further extends "the predominantly flat trend" seen over the last six months, with the average house price having barely changed since March.

"While ongoing economic uncertainty continues to weigh on consumer sentiment - with evidence of both buyers and sellers exercising some caution - a number of important underlying factors such as affordability and employment remain strong.

"Although the housing market will undoubtedly be influenced by events in the wider economy, it continues to show a degree of resilience for the time being. We should also not lose sight of the fact that the single biggest driver of both prices and activity over the longer-term remains the dearth of available properties to meet demand from buyers."

Market participants were also digesting news that the People's Bank of China was cutting the amount of cash that banks need to hold as reserves for the third time this year, by 50 basis points.

In equity markets, house builder Berkeley was in the green as it said first-quarter market conditions in London and the South East had remained robust, although Brexit worries and high transaction costs were constraining the wider market. Shares of Barratt Developments also rose.

G4S surged after Sky News reported that US cash-handling business The Brink's Company could make a £1bn bid for the security services firm's cash solutions arm.

On the downside, SIG slumped as it said first-half pre-tax profit fell to £5.2m from £19.6m in the same period a year ago amid a marked deterioration in the level of construction activity in the UK.

Market Movers

FTSE 100 (UKX) 7,282.34 0.15%
FTSE 250 (MCX) 19,695.95 0.24%
techMARK (TASX) 3,865.55 0.62%

FTSE 100 - Risers

Aveva Group (AVV) 3,966.00p 3.77%
Smurfit Kappa Group (SKG) 2,608.00p 3.41%
Berkeley Group Holdings (The) (BKG) 3,980.00p 2.76%
Just Eat (JE.) 782.80p 2.41%
Ocado Group (OCDO) 1,363.50p 2.40%
Croda International (CRDA) 4,788.00p 2.00%
Experian (EXPN) 2,631.00p 1.74%
Rentokil Initial (RTO) 465.30p 1.73%
Hargreaves Lansdown (HL.) 1,982.00p 1.61%
London Stock Exchange Group (LSE) 7,322.00p 1.58%

FTSE 100 - Fallers

United Utilities Group (UU.) 784.20p -2.92%
Severn Trent (SVT) 2,024.00p -1.84%
Centrica (CNA) 67.86p -1.79%
SSE (SSE) 1,150.00p -1.58%
Prudential (PRU) 1,404.50p -1.30%
Royal Bank of Scotland Group (RBS) 188.10p -1.23%
BP (BP.) 501.00p -1.18%
Royal Dutch Shell 'A' (RDSA) 2,259.50p -1.09%
Royal Dutch Shell 'B' (RDSB) 2,256.00p -1.01%
British Land Company (BLND) 517.20p -0.88%

FTSE 250 - Risers

G4S (GFS) 186.50p 6.45%
Sanne Group (SNN) 565.00p 6.40%
IP Group (IPO) 63.90p 6.15%
Ted Baker (TED) 999.00p 5.71%
Dunelm Group (DNLM) 859.50p 4.24%
Syncona Limited NPV (SYNC) 252.50p 3.91%
Amigo Holdings (AMGO) 75.00p 3.59%
CYBG (CYBG) 113.35p 3.05%
Aston Martin Lagonda Global Holdings (AML) 536.20p 2.76%
Bakkavor Group (BAKK) 111.40p 2.58%

FTSE 250 - Fallers

SIG (SHI) 121.30p -6.04%
Barr (A.G.) (BAG) 576.00p -6.04%
Grafton Group Units (GFTU) 735.00p -5.28%
Funding Circle Holdings (FCH) 105.80p -5.03%
PureTech Health (PRTC) 268.00p -4.96%
Tullow Oil (TLW) 211.70p -3.33%
Go-Ahead Group (GOG) 2,140.00p -3.08%
Ascential (ASCL) 384.00p -2.74%
Pennon Group (PNN) 745.80p -2.31%
Cairn Energy (CNE) 173.30p -2.26%