ADVFN Morning London Market Report: Wednesday 20 April 2016

London open: Stocks fall as oil prices reverse gains

UK stocks declined on Wednesday as oil prices reversed the previous day’s gains and investors awaited jobs data.

Oil prices dropped after a three-day strike by oil workers in Kuwait ended on Tuesday night. The strike over pay had disrupted production and provided a lift to sentiment amid concerns about an oversupply sending oil prices lower.

Traders will be closely scrutinising the US government’s weekly crude inventories report at 1530 BST.

At 0851 BST, Brent crude fell 2.6% to $42.90 per barrel and West Texas Intermediate dipped 2.6% to $41.36 per barrel.

Meanwhile in macroeconomic data, the Office for National Statistics releases its latest UK jobs statistics at 0930 BST.

The UK is expected to have added 60,000 jobs in the three months to February. The unemployment rate is projected to remain at 5.1% during the period. Average weekly earnings are forecast to rise 2.3%, accelerating from the previous quarter’s 2.1% growth.

The Bank of England is monitoring the labour market as it determines the timing for an interest rate hike. The BoE cited weak wage growth as part of its reason to keep rates unchanged for the 85th month in April.

In company news, shares in ARM Holdings jumped after the chip maker reported a 14% increase in first quarter revenue that surpassed analysts’ expectations.

BHP Billiton rallied after saying it was on track to deliver an average unit cost improvement of 14% across its major assets, with productivity gains continuing to be realised.

Burberry was in the red after Goldman Sachs downgraded the stock to ‘neutral’ from ‘buy’ in a report released to investors.

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