- FTSE 100 down 23 points
- US non-farm payrolls undershoot
- Gold hits new record at US$2,887
3.58pm: FTSE 100 heads towards weekend on back foot as gold notches record
London’s blue chips approached the weekend on the back foot, having receded from record territory on Friday with a 23-point drop to 8,704.
A gain was recorded for the week though, with the FTSE 100 sitting 30 points, or 0.4% higher, buoyed by Thursday’s Bank of England interest rate cut.
Legal & General remained top of the risers on Friday afternoon, climbing 2.5% after detailing a £1.8 billion deal with Japan’s Meiji Yasuda to sell its US protection business.
Glencore PLC, BP PLC and BAE Systems PLC were among other gainers in the absence of any major movers, while Barratt Redrow PLC topped the fallers.
Mid and small caps also racked up for the week, despite declines on Friday, with the FTSE 350 adding 0.3% and AIM all-share climbing 0.1%.
Ferrexpo PLC led the mid-cap risers for the day, up 8.1%, having taken a beating mid-week on allegations of mining minerals outside of permits in Ukraine.
Enteq Technologies PLC and ImmuPharma PLC were among the junior market risers in the meantime, alongside Falcon Oil & Gas PLC.
Elsewhere, gold looked to close off the week on a high, notching yet another record on Friday of US$2,887 an ounce after mixed employment figures in the US.
2.49pm: Nasdaq, S&P up but Dow Jones down on soft non-farm payrolls
Wall Street got off to a mixed start on Friday after figures showed the US economy added fewer jobs than expected but also a surprise drop in unemployment through January.
The Nasdaq added 0.3% after the bell, as the S&P 500 rose 0.1% but the Dow Jones slipped just below the mark.
Non-farm payroll data had shown the addition of 143,000 jobs last month, against the 170,000 expected, alongside a drop in unemployment from 4.1% to 4.0%.
Payrolls were also below the 10-year average of around 180,000 prior to the pandemic, Evelyn Partners chief investment strategist Daniel Casali pointed out.
However, XTB analyst Kathleen Brooks noted January’s California fires and uncertainty following Donald Trump’s inauguration could have impacted the latest figures.
“President Trump’s tariffs and his new economic policy could have meant that employers sat on the sidelines in January, and we will need to see if that continues this month,” she said.
Given focus on the Federal Reserve for any indication around further rate cuts this year, Casali added: “The bottom line is that employment is growing sufficiently.
“The risk of a sharp uptick in the unemployment rate seems contained.”
1.46pm: US non-farm payrolls undershoot expectations
Fewer jobs were added across the US economy than expected in January, figures showed on Friday.
According to the US Bureau of Labor Statistics, non-farm payrolls sat at 143,000 for the month, against an upwardly revised 307,000 in December and expectations for 170,000.
Unemployment unexpectedly moderated from 4.1% to 4.0% in the meantime, after annual adjustments in population controls.
Charles Schwab US managing director Richard Flynn noted the soft figures may prompt central bankers’ ears to “prick up” as labour demand slowed.
“That said, it feels unlikely that this report alone would prompt a change in rates.
“We expect that it would take a significant surprise from economic indicators for the Fed to consider deviating from its anticipated plateau, given ongoing uncertainty around the potential impact of upcoming policy changes from the new government administration.”
Futures showed the Nasdaq, S&P 500 and Dow Jones all lower following the figures.
1.22pm: UK economy and US inflation come into spotlight next week
Macroeconomic headlines are set to be dominated by UK gross domestic product data and US inflation figures next week.
After fears around tariffs under Donald Trump hampered global stocks and sparked fears over inflation earlier in the month, the US consumer price index will be in focus.
Wednesday will see the figures for January released, with markets expecting inflation to have slowed from 0.4% to 0.3% over the month and remain at 2.9% on an annual basis.
The UK economy will then emerge in the spotlight on Thursday, as December and fourth quarter gross domestic product growth figures are unveiled.
After flatlining in the previous two months, the Bank of England slashed its forecast for UK economic growth this year as it cut interest rates.
According to Trading Economics, expectations are for another month of just 0.1% growth, leaving the economy contracting by 0.1% over the quarter.
Retail sales from both sides of the Atlantic, alongside Eurozone gross domestic product data will also be in focus next week.
12.27pm: M&S eyeing next phase after non-food leadership shuffle - analysts
Marks and Spencer Group PLC is eyeing the next phase of its growth after reshuffling of its non-food leadership team, Shore Capital analysts have said.
M&S on Thursday said former BooHooGroup PLC boss John Lyttle would take the helm of its clothing and home arm in place of Richard Price under a wider reshuffle.
Womenswear director Maddy Evans was also promoted and Amazon.com Inc European fashion director David Brittain poached as part of the move.
“All in, we see notable new human capital here that provides perspectives and energy to build upon Mr Price's firmer non-food foundations,” Shore Cap noted in response.
“The next phase of the advancement of the group's non-food proposition, therefore, is about to begin,” analysts added.
M&S has been flagged for strong grocery sales growth in recent months, including over the key Christmas period, but also into the new year.
Shore Cap acknowledged M&S had “been a much-improved performer of UK retailing in recent years”.
“Driving share gains, now delivering much aspired sequential earnings growth, and improved optionality to sustain such metrics that with a strong balance sheet provides the ingredients to sustain a more rewarding equity outlook for its shareholders.”
11.35pm: Wall Street seen mixed before non-farm payrolls
Futures pointed to a mixed start on Wall Street as Friday brought employment figures into focus after a volatile week.
The Nasdaq was seen 0.1% lower alongside the S&P 500 ahead of the opening bell, while the Dow Jones appeared just above the mark.
Stocks had largely gained on Thursday, with the S&P 500 and Nasdaq both moving higher as fears around US-China trade relations appeared to dissipate for the time being.
Attention on Friday then turned to non-farm payroll and unemployment figures for January and any resultant hint on the direction of interest rates ahead.
Expectations are for fewer jobs to have been added to the economy, at 170,000 against December’s 256,000, as unemployment remains unchanged at 4.1%.
“Investors will also focus on the annual revisions to the jobs figures,” Swissquote Bank analyst Ipek Ozkardeskaya said.
A downward revision would fuel “the narrative that the US jobs market is healthily slowing – a scenario that would allow the Fed to continue cutting the rates but not hurriedly, and keep the market sentiment at a sweet spot,” Ozkardeskaya added.
“A weaker-than-expected NFP figure, and/or rising wages would weigh on sentiment.
“A stronger-than-expected NFP - if combined to softening wages would reinforce the goldilocks scenario.”
10.46am: FTSE 100 remains under pressure
Pressure remained on London’s blue chips into late morning, with the FTSE 100 dropping 21 points to sit at 8,705.
Legal & General Group PLC remained the most notable riser, up 5.2%, after unveiling the £1.8 billion sale of its US protection business in a deal with Japan’s Meiji Yasuda.
Marks and Spencer Group PLC topped the fallers in the meantime, dropping 3.1%. It had singalled non-food leadership changes on Thursday, including the appointment of former Boohoo boss John Lyttle to head its clothing, home and beauty operation.
London’s mid and small-caps also fell on Friday, with the FTSE 350 off 0.2% and AIM all-share just off the mark.
Elsewhere, oil prices regained as the weekend approached, with benchmark Brent crude up at US$74.88 a barrel, against as low as US$74.13 on Thursday.
Gold also picked up a 0.25% gain for the day to sit at US$2,867 an ounce, having hit an all-time high of US$2,883 earlier in the week.
9.47am: Shein reportedly to slash valuation for London IPO
Shein is reportedly to slash its valuation in a potential float on the London stock exchange.
According to Reuters-cited sources, the online fast-fashion retailer was targeting US$50 billion (£40.1 billion), marking a drop of almost a quarter of the valuation secured in a 2023 fundraiser.
Prospects had been clouded in recent days due to the removal of tax exemptions on low-value parcels into the US, the report said.
It added the closure of the ‘de minimis’ exemption threatened to hit Shein’s profitability and fuel price rises in its largest market.
Such rules had been slated by rival retailers for allowing the likes of Shein to undercut the market by shipping single packages straight to consumers.
8.59am: Amazon set for $100bn hit after disappointing figures
Amazon.com Inc shares shed 4% in after-hours trading following underwhelming results overnight, erasing $100 billion from the company’s market value.
The decline followed strong fourth-quarter earnings that exceeded expectations but were overshadowed by weaker-than-expected guidance for the current quarter.
Amazon reported earnings per share of $1.86, surpassing the anticipated $1.49, while revenue reached $187.79 billion, slightly above estimates.
Despite a 10% increase in quarterly revenue from the previous year, Amazon projected first-quarter sales between $151 billion and $155.5 billion, falling short of the expected $158.5 billion... Read more
8.09am: FTSE 100 slips as AstraZeneca, GSK retreat; L&G surges
The FTSE 100 headed lower as trading got underway on Friday, in line with a drop for heavyweights AstraZeneca PLC and GSK PLC.
London’s blue-chip index slipped 18 points to 8,708 initially, having hit a record high of 8,767 on Thursday.
AstraZeneca, its largest constituent, and GSK topped the fallers, with respective declines of 1.7% and 1.8%, after both had enjoyed gains earlier in the week on impressive results.
Legal & General Group PLC surged 8.2% in the meantime to head the risers, following news it had struck a £1.8 billion deal to sell its US protection business to Japan’s Meiji Yasuda.
The agreement also includes a long-term partnership aimed at expanding L&G’s US Pension Risk Transfer business, with Meiji Yasuda taking a 20% stake.
As part of the deal, Meiji Yasuda is planning to acquire around 5% of L&G’s shares, deepening ties between the two firms... Read more
7.57am: House prices return to growth in January to hit record
House prices climbed to a record high in January, pushed by strong demand, in part as prospective buyers raced to complete deals before stamp duty hikes.
According to Halifax, average house prices rose by 0.7% over the month, or 3.0% on an annual basis, to £299,138, after falling by 0.2% in December.
Head of mortgages at the lender, Amanda Bryden, flagged the market’s resilience was “noteworthy” as affordability challenges remained and consumer confidence waned.
“There’s strong demand for new mortgages and growth in lending,” she said, highlighting a likely boost as buyers rushed ahead of stamp duty increases in April.
Northern Ireland saw the strongest growth, while prices in Scotland climbed at the slowest rate.
“Mortgage rates are likely to hover between 4% and 5% in 2025,” Bryden added, “but the fundamental issue in the housing market remains the lack of supply”.
7.47am: Ashmore stems net outflows despite US election hit
Ashmore Group PLC has said net outflows moderated over the first half despite tough conditions most recently around the US election and bond market chaos.
Net outflows sat at US$1.1 billion (£0.9 billion) in the six months to the end of December, against US$4.5 billion a year ago, the emerging markets asset manager said Friday.
Assets under management dipped slightly from US$49.3 billion to US$48.8 billion in the meantime, as strong trading over the first quarter was said to have reversed in the second.
Index returns had been “strong” in the quarter to September as the Fed cut interest initially and Beijing laid out measures to stimulate the Chinese equity market.
However, returns turned negative in the second quarter on positioning for the US election, renewed dollar strength and hawkish commentary from the Fed which hit bond markets.
Adjusted revenue dropped from £93.4 million to £79.9 million over the first half, as pre-tax profit slipped from £54.0 million to £44.1 million on lower fees and currency headwinds.
7.16am: FTSE 100 set for further gain after record
London’s blue chips were eyeing a further gain after closing Thursday’s session at a record high of 8,727, with the FTSE 100 seen adding six points ahead of trading.
Stocks had surged as the pound slumped in line with the Bank of England’s move to cut interest from 4.75% to 4.50% and slash projections for the UK economy ahead.
Come Friday, sterling was down a further 0.06% against the greenback at US$1.2426.
Overnight, Asian markets faced a mixed showing, with Chinese stocks gaining but Japan’s Nikkei among the fallers, dropping 0.7%.
US stocks had also been mixed prior, with the Dow Jones falling on Thursday as the Nasdaq and S&P 500 both ticked up.
5.00am: Friday's schedule
A quieter Friday will see house price data from Halifax and non-farm payroll figures in the US take centre stage.
Expectations are for the US economy to have added fewer jobs in January than December... Read more
Announcements due:
Interims: Ashmore Group PLC
AGMs: Agronomics Limited, Victrex
Economic announcements: Halifax House Prices (UK), Non-farm Payrolls (US), Unemployment (US)