London’s blue chips were on the back foot again as Asian markets endured another tough session.
FTSE 100 shed 60 points to 6,133, after markets in Tokyo and Hong Kong fell sharply. China is closed for a four days of public holidays.
American markets were largely flat, though attention today will switch to the non-farm jobs figure for August due at 1.30pm UK time.
Consensus forecasts are for around 220,000 jobs to have been created.
The US Federal Reserve’s next interest rate meeting is on 16 September and a strong payrolls number may tip the central bank towards a rise in interest rates.
Craig Erlam, analyst at futures group OANDA, said: “It would appear we’re going to see risk aversion in the markets on Friday ahead of what is clearly a very important jobs report for the US, the final one before the September Fed meeting in under two weeks.
“This cautious approach prior to such a key release is quite common in the markets, especially when this release could determine whether we see a change in monetary policy, on this occasion the first rate hike in almost a decade.
Here, company news was dominated by the seeming victory for GVC in the battle for online gaming group Bwin.party (LON:BPTY).
Bwin.Party’s board has decided to switch its recommendation to a £1.1bn offer from Sportingbet owner GVC rather than the previously favoured 888 (LON:888) bid. The offer is worth around 130p per share.
A disappointing retail sales number hit shares in a number of the major high street chains.
August was the worst month for UK retailers since 2008 accountancy firm BDO reported, as poor weather sparked a rush for the sun from British shoppers.Retail sales fell by 4.3% on a year earlier, the sixth monthly fall this year.
High St bellwether Next (LON:NXT) was the worst performer on the FTSE 100, shedding more than 3% to 7,600p while there were heavy falls also for electronics retailer Dixons Carphone (LON:DC) and fashion giant Burberry (LON:BRBY).
Airlines, in contrast, are benefiting from the trend as people flee the UK weather.
Easyjet (LON:EZJ) raised its profit forecast yesterday and rose by 11p today to 1,773p, while British Airways’ owner IAG (LON:IAG) climbed 9p to 574p.
Among the small caps, IS Solutions (LON:ISL) rose 35%. The data analyser has signed two new contracts with financial services firm worth more than £4mln in revenue.
Antibody supplier Bioventix (LON:BVXP) rose 20% as it said its core business remains “robust,” with sales expected to be around £4.2mln for the year.
Coms (LON:COMS) fell 10% as it cautioned losses from getting rid of its telecommunications business will mean a substantial deficit in the first half of this year.