London close: Stocks end lower after US jobs report
London stocks finished lower on Friday following the release of weaker-than-expected US non-farm payrolls numbers which served to push the pound higher.
Commenting on the possible implications of those figures, AJ Bell Investment Director, Russ Mould, said: "It's unlikely the Fed needs too many excuses to do nothing, especially none of its three previous attempts to tighten monetary policy over the past decade lasted long, but surely things have come to a pretty pass if one set of monthly jobs data is enough to set the tone for monetary policy at the world’s most powerful central bank?
"The numbers are backward-looking and prone to revision (the last two months’ payrolls numbers were both revised upward alongside the latest data release) and so may not be the most reliable basis for taking such an important decision."
The FTSE 100 ended the day down 0.36% at 7,138.36 while the second-tier index drifted lower by 0.13% to 24,194.61.
Cable was 0.22% higher alongside as of 1700 BST to 1.3864.
According to the US Department of Labor, non-farm payrolls grew by just 235,000 in August (consensus: 787,000), although the unemployment rate did drop by two tenths of a percentage point from the month before to 5.2%.
On home shores, a survey out earlier showed growth in the services sector eased in August to its slowest pace since March amid supply chain and staff issues.
The IHS Markit/CIPS services purchasing managers’ index fell to 55.5 from 59.6 in July and a record high of 62.9 in May. A reading above 50.0 signals expansion, while a reading below indicates contraction.
The survey found that capacity constraints encouraged additional staff recruitment, with the rate of job creation in August surging higher than the previous record in June 2014.
The composite index, which measures activity in services and manufacturing, declined to 54.8 in August from 59.2 in July.
In equity markets, GKN owner Melrose was a high riser for the second day in a row after well-received results on Thursday.
Discoverie was the standout gainer on the FTSE 250 after it raised £55m in a placing to fund two acquisitions.
Berkeley Group was little changed after saying it was experiencing construction cost inflation and "mindful of ongoing supply chain and labour market issues due to Brexit and the pandemic". The housebuilder maintained full-year guidance of pre-tax profit at or above last year’s £518m for the 12 months to April 30, 2022.
Emerging markets asset manager Ashmore fell despite posting a jump in full-year assets under management as it benefited from a positive investment performance as economic activity picks up. In the year to the end of June 2021, AuM rose 13% to $94.4bn, with an investment performance of $9.6bn and net inflows of $1.2bn.
FTSE 100 - Risers
Fresnillo (FRES) 861.20p 3.36%
Melrose Industries (MRO) 189.80p 3.02%
Reckitt Benckiser Group (RKT) 5,697.00p 1.91%
Polymetal International (POLY) 1,459.00p 1.74%
Flutter Entertainment (CDI) (FLTR) 14,495.00p 1.51%
Legal & General Group (LGEN) 280.10p 1.27%
Glencore (GLEN) 333.10p 1.20%
B&M European Value Retail S.A. (DI) (BME) 545.40p 1.00%
Land Securities Group (LAND) 736.60p 0.96%
Halma (HLMA) 3,061.00p 0.76%
FTSE 100 - Fallers
Ocado Group (OCDO) 2,011.00p -3.78%
International Consolidated Airlines Group SA (CDI) (IAG) 155.80p -2.53%
Bunzl (BNZL) 2,592.00p -2.26%
Rolls-Royce Holdings (RR.) 111.90p -2.05%
InterContinental Hotels Group (IHG) 4,584.00p -2.01%
Weir Group (WEIR) 1,753.00p -1.82%
Intermediate Capital Group (ICP) 2,254.00p -1.70%
Informa (INF) 549.60p -1.65%
Whitbread (WTB) 3,202.00p -1.54%
Ashtead Group (AHT) 5,742.00p -1.51%
FTSE 250 - Risers
Discoverie Group (DSCV) 1,250.00p 21.60%
Hochschild Mining (HOC) 161.20p 9.36%
Harbour Energy (HBR) 378.80p 4.30%
Centamin (DI) (CEY) 98.68p 3.76%
IG Group Holdings (IGG) 872.50p 3.75%
Grainger (GRI) 334.40p 2.58%
Crest Nicholson Holdings (CRST) 419.40p 2.54%
Vistry Group (VTY) 1,203.50p 2.29%
4Imprint Group (FOUR) 2,965.00p 2.24%
Volution Group (FAN) 552.00p 2.22%
FTSE 250 - Fallers
Network International Holdings (NETW) 375.20p -4.58%
Auction Technology Group (ATG) 1,414.00p -4.07%
Ashmore Group (ASHM) 380.20p -3.70%
Dechra Pharmaceuticals (DPH) 5,085.00p -3.69%
Micro Focus International (MCRO) 419.90p -3.63%
Carnival (CCL) 1,526.20p -3.48%
Wood Group (John) (WG.) 243.70p -2.95%
Investec (INVP) 290.60p -2.68%
National Express Group (NEX) 251.00p -2.64%
Moonpig Group (MOON) 385.00p -2.63%