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London open: Stocks steady ahead of UK jobs data; Burberry rallies
London stocks were steady in early trade on Tuesday as investors eyed the release of key UK jobs data.
At 0840 BST, the FTSE 100 was flat at 7,534.07, with the ILO unemployment rate, claimant count and average earnings all due at 0930 BST.
Spreadex analyst Connor Campbell said: “A do-nothing start for the global indices left the floor clear for investors to focus on the incoming UK jobs report.
“Even before the latest jobs data, life continued to leech out of sterling as the prospect of Brexity Boris Johnson as PM grows ever closer. Cable tumbled back under $1.249 after shedding 0.3%, while against the euro sterling was flailing at a fresh 6-month nadir of €1.1095.
“It is, then, going to take a pretty special jobs report to clear the dark clouds currently hanging over the currency. Sadly for sterling, wage growth is merely expected to hold at 3.1%, with the unemployment rate similarly unchanged at 3.8%; the claimant count change, meanwhile is set to fall from 23.2k to 18.9k.”
In equity markets, luxury fashion brand Burberry was sitting pretty at the top of the FTSE 100 after it reported a 4% jump in first-quarter sales – double what analysts were expecting – as it enjoyed a good response to a collection by new chief designer Riccardo Tisci and a solid performance in China.
Broadcaster ITV followed close behind after an upgrade to ‘buy’ at Liberum, while Aston Martin Lagonda rose to the top of the FTSE 250 after an upgrade to ‘hold’ at Jefferies.
Building materials group CRH ticked higher as it agreed to sell off its Europe distribution business to private equity funds managed by Blackstone for €1.64bn in cash.
On the downside, credit-checking firm Experian was weaker as it posted a 4% increase in first-quarter revenue thanks to a solid performance in North America, but a drop in revenue in all the UK and Ireland.
AG Barr was the biggest loser on the FTSE 250 as the Irn-Bru maker warned on profits, pointing to poor volumes following the introduction of the soft drinks levy and disappointing spring and early summer weather. Fellow drinks maker Britvic also fizzed lower.
Insurer Hastings was under the cosh after saying it will take a one-off pre-tax charge of £8.4m this year as a result of the change to the Ogden rate to -0.25% from -0.75%, which takes effect from 5 August.
Recruiter Hays lost ground as it posted flat net fees for the fourth quarter, while Lloyds was hit by a downgrade to ‘neutral’ at JPMorgan.
