London close: FTSE ends flat as traders weigh economic data and earnings

The FTSE 100 finished flat on Thursday as traders digested economic data and mixed corporate earnings.

UK service sector growth slumped to a 38-month low in April, according to data. The Markit/CIPS UK services purchasing managers’ index fell to 52.3 in April from 53.7 in March, its lowest since February 2013 and below economists’ expectations for a reading of 53.6.

A reading above 50 indicates expansion, while one below that level suggests a contraction.

Chris Williamson, chief economist at Markit, said: “The slowdown in the service sector follows similar weakness in manufacturing and construction to make a triple-whammy of disappointing news on the health of the economy at the start of the second quarter.

““The PMI surveys are collectively indicating a near-stalling of economic growth, down from 0.4% in the first quarter to just 0.1% in April.”

The Caixin China services PMI came in at 51.8 for April, down from 52.2 in March. It follows disappointing manufacturing PMIs on Tuesday, fuelling worries about the health of the world’s second largest economy.

In the US, the weekly jobless claims report from the Labor Department on Thursday revealed a bigger-than-expected increase. Initial jobless claims climbed to 274,000 in the week to 30 April from 257,000 the previous week, worse than forecasts of 260,000.

The report comes ahead of the all-important non-farm payrolls figures on Friday, which are expected to show US employers added 200,000 jobs in April compared to 215,000 in March.

On the corporate front, BT Group rallied after reporting a 9% rise in full year adjusted profits before tax to £3.5bn and a 6% gain in revenue to £18.9bn, boosted by two months' contribution from newly acquired EE.

RSA Insurance jumped after saying first quarter underwriting results were “good” with operating profits up strongly as a consequence.

Morrisons advanced after reporting a 0.7% rise in first quarter like-for-like sales, excluding fuel, and a 1.2% rise including fuel. It was the second consecutive quarter of positive like-for-like sales growth for the chain, which had been flagging in recent years.

Software company Sage was sitting lower after it reported a drop in first-half pre-tax profit despite a rise in revenue, as it announced an agreement to buy a 20.7% stake in Fairsail.

Rolls-Royce declined as it warned that 2016 continues to be a “challenging year overall as we sustain investment and start to transition major products in Civil Aerospace, and tackle weak markets in Marine”.

Centrica was under pressure after the British Gas owner announced plans to raise around £750m in a placing to fund acquisitions and cut debt.

Smith & Nephew dropped after saying weakness in China offset a solid performance in the US in its first quarter revenue.

Meanwhile, oil prices advanced as a wildfire near Canada’s oil-sands district threatened production. Fighting in Libya also helped to lift prices.

Brent crude rose 1.95% to $45.47 per barrel and West Texas Intermediate increased 2.14% to $44.74 per barrel at 1633 BST.

Market Movers

FTSE 100 (UKX) 6,108.99 -0.05%
FTSE 250 (MCX) 16,643.92 -0.09%
techMARK (TASX) 3,038.35 -0.34%

FTSE 100 - Risers

BT Group (BT.A) 451.05p 2.64%
Pearson (PSON) 802.50p 2.29%
Next (NXT) 5,265.00p 2.23%
Morrison (Wm) Supermarkets (MRW) 191.60p 2.19%
RSA Insurance Group (RSA) 479.00p 2.02%
Antofagasta (ANTO) 442.30p 1.63%
TUI AG Reg Shs (DI) (TUI) 1,000.00p 1.42%
Anglo American (AAL) 654.60p 1.40%
Standard Life (SL.) 318.80p 1.30%
Imperial Brands (IMB) 3,753.50p 1.17%

FTSE 100 - Fallers

Centrica (CNA) 208.00p -10.00%
Inmarsat (ISAT) 864.00p -7.10%
Sage Group (SGE) 583.50p -3.39%
Smith & Nephew (SN.) 1,130.00p -2.92%
Royal Bank of Scotland Group (RBS) 212.80p -2.92%
Rolls-Royce Holdings (RR.) 630.00p -2.33%
Provident Financial (PFG) 2,880.00p -2.11%
Worldpay Group (WI) (WPG) 261.60p -1.73%
Berkeley Group Holdings (The) (BKG) 2,891.00p -1.53%
Shire Plc (SHP) 4,046.00p -1.46%

FTSE 250 - Risers

Tullow Oil (TLW) 257.00p 6.07%
Greggs (GRG) 1,095.00p 4.48%
esure Group (ESUR) 280.00p 4.09%
Vedanta Resources (VED) 385.90p 2.91%
UK Commercial Property Trust (UKCM) 82.80p 2.86%
Jimmy Choo (CHOO) 124.80p 2.72%
Kaz Minerals (KAZ) 162.80p 2.71%
TalkTalk Telecom Group (TALK) 261.10p 2.23%
Entertainment One Limited (ETO) 185.20p 2.15%
Wetherspoon (J.D.) (JDW) 715.00p 2.14%

FTSE 250 - Fallers

Barr (A.G.) (BAG) 536.00p -4.71%
Shawbrook Group (SHAW) 280.00p -4.11%
Henderson Group (HGG) 239.00p -3.63%
Allied Minds (ALM) 357.00p -2.96%
Interserve (IRV) 392.40p -2.80%
McCarthy & Stone (MCS) 218.90p -2.71%
AO World (AO.) 175.30p -2.61%
Ocado Group (OCDO) 287.00p -2.55%
Aldermore Group (ALD) 184.40p -2.33%
Clarkson (CKN) 2,265.00p -2.29%