MID SESSION MARKET WRAP

The Mid Session Wrap is a report on the biggest movers in the FTSE 100 and macroeconomic news that impacts movements in share prices. The report also previews macroeconomic data that is due to be released over the course of the session.

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Thursday, February 02, 2012

FTSE 100 holds steady after US jobs data

FTSE 100 holds steady after US jobs data

UK stocks held on to yesterday’s gains despite today’s somewhat disappointing construction data and bearish statements from head of the Eurogroup Jean Claude Juncker, who called the negotiations between Greece and its private bondholders “ultra difficult”.

The FTSE 100 stood at 5,793, up just 1.5 points from Wednesday’s close.

The Markit/CIPS PMI index for the construction sector fell from 53.2 in December to 51.4 last month with readings above 50 indicating expansion, while anything below that level signals contraction. The weaker than expected construction figures were offset by weekly jobless claims data from the US Department of Labor.

The report showed that the number of initial applications for unemployment benefits fell 12,000 to 367,000 last week. This was slightly ahead of expectations as analysts polled by Bloomberg forecast a decline of 10,000.

Traders are now looking to tomorrow’s crucial non-farm payrolls data for January. The official figures from the Department of Labor will follow yesterday’s report from payrolls processor ADP, which showed that the private sector created 170,000 jobs last month.

Mining giant Xstrata (LON:XTA, up 10.3pct at 1,235p) and commodities traded Glencore (LON:GLEN, up 6.7pct at 460.5p) topped the FTSE 100 leaderboard after confirming they were in merger talks.

Other mining stocks including Vedanta Resources (LON:VED, up 4.5pct at 1,307p), Antofagasta (LON:ANTO, up 2.5pct at 1,363p) and Anglo American (LON:AAL, up 2.3pct at 2,797p) also showed up among the top risers.

Outside of the mining sector, shares in Smith & Nephew (LON:SN., up 4.6pct at 640.5p) were in demand after the medical devices manufacturer announced 800 job cuts.

The heaviest fallers in the blue chip index included consumer goods company Unilever (LON:ULVR, down 4.5pct at 1,992p), which reported lower than expected sales and profit growth for 2011.

Unilever was followed by pharmaceutical major AstraZeneca (LON:AZN, down 3.8pct at 2,971.5p), whose 2011 also fell short of forecasts.


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