London close: FTSE ends higher as mining stocks rally

The FTSE 100 finished higher on Friday as traders weighed a batch of data including the US non-farm payrolls report.

The US added 38,000 jobs in May, well below the 160,000 that economists had expected, the Labor Department revealed. It marked the weakest non-farm payrolls report since September 2010 and compared to a downwardly revised 123,000 jobs in April.

The unemployment rate fell to 4.7% in May from 5.0% in April, beating estimates of 4.9%. This was due in part to a drop in the labour force participation rate from 62.8% to 62.6%.

Average hourly earnings grew by 0.2% month-on-month and 2.5% year-on-year, in-line with economists´ forecasts.

"The Federal Reserve’s plans to raise interest rates in the near future have hit a serious bump in the road in the form of the May jobs report, which has fallen well below expectations and shown the lowest monthly rate of job creation since 2010,” said Ranko Berich, head of market analysis atMonex Europe.

“The Fed has recently been signalling that it is willing to raise rates if fundamental data continues to improve, but today’s report shows that this is no longer the case. Only the most bullish FOMC members are likely to be willing to look through this month’s weak NFP report, and as a result there’s a very good chance we’ll see the Fed hold fire on interest rates for even longer."

Oil prices fell following the report with Brent crude down 1.17% to $49.46 per barrel and West Texas Intermediate down 1.2% to $48.55 per barrel at 1646 BST.

Economic data

UK services growth picked up in May but remained subdued, data showed. The Markit/CIPS services purchasing managers’ index rose to 53.5 from April’s 38-month low of 52.3, beating expectations for a reading of 52.5. A reading above 50 signals an expansion in the sector while a level below that suggests a contraction

The Caixin China services PMI fell to 51.2 in May from 51.8 in April.

The eurozone services PMI for May was unexpectedly revised higher to 53.3 from 53.1.

Eurozone retail sales were stable in April compared to a month ago, missing forecasts for a 0.4% increase, Eurostat said. On the year sales grew 1.4% in April, below estimates for a 2.1% gain.

The final US services PMI came in at 51.3 in May, up a touch from the flash estimate of 51.2 but down from 52.8 in April.

The ISM non-manufacturing composite came in at 52.9 in May, trailing estimates for a reading of 55.4 and following a level of 55.7 in April.

US factory orders rose the most in six months in April, according to the Commerce Department. New orders for manufactured goods jumped 1.9% year-on-year in April, ahead of forecasts for a 1.8% increase and following a 1.5% gain in March.

The US trade deficit widened in April by 5.3% from March to a seasonally adjusted $37.44bn, the Commerce Department said. Exports of goods and services rose 1.5% while imports climbed 2.1%. A deficit of $41.50 was expected by analysts.

Companies

Heavily-weighted mining stocks were the standout gainers as metals prices advanced, with silver miner Fresnillo the top performer.

Merlin Entertainments racked up healthy gains a day after Barclays reiterated its ‘overweight’ stance on the stock saying the shares were cheap.

BP was also in the black after the oil giant settled a lawsuit arising from the 2010 Deepwater Horizon oil spill by agreeing to pay investors who bought American Depository Shares $175m.

Supermarkets suffered the brunt of the losses. HSBC maintained its 'reduce' stance on Sainsbury in a note on Friday, noting the company is losing sales as it prepares to integrate Argos and as completion intensifies.

PZ Cussons was under the cosh after Canaccord Genuity cut the stock to ‘hold’ from ‘buy’, keeping the price target at 345p as it recommended taking profits ahead of the full-year update.

Market Movers

FTSE 100 (UKX) 6,206.90 0.34%
FTSE 250 (MCX) 17,062.15 -0.08%
techMARK (TASX) 3,121.81 -0.11%

FTSE 100 - Risers

Fresnillo (FRES) 1,122.00p 7.47%
Randgold Resources Ltd. (RRS) 6,250.00p 6.84%
Glencore (GLEN) 135.45p 5.37%
Anglo American (AAL) 616.80p 4.99%
BHP Billiton (BLT) 833.60p 3.48%
Merlin Entertainments (MERL) 433.10p 3.29%
Antofagasta (ANTO) 428.30p 2.61%
National Grid (NG.) 979.30p 2.05%
Associated British Foods (ABF) 2,953.00p 1.83%
Rio Tinto (RIO) 1,896.00p 1.63%

FTSE 100 - Fallers

Tesco (TSCO) 162.15p -4.34%
Sainsbury (J) (SBRY) 246.10p -4.20%
Morrison (Wm) Supermarkets (MRW) 188.60p -3.97%
Johnson Matthey (JMAT) 2,938.00p -1.90%
Standard Life (SL.) 327.30p -1.89%
Pearson (PSON) 836.50p -1.53%
Prudential (PRU) 1,330.00p -1.48%
London Stock Exchange Group (LSE) 2,663.00p -1.37%
Legal & General Group (LGEN) 232.60p -1.32%
Standard Chartered (STAN) 526.70p -1.31%

FTSE 250 - Risers

Indivior (INDV) 235.10p 36.21%
Acacia Mining (ACA) 330.00p 7.46%
Centamin (DI) (CEY) 106.30p 6.73%
Supergroup (SGP) 1,496.00p 4.62%
Allied Minds (ALM) 350.80p 3.91%
Kaz Minerals (KAZ) 147.80p 2.78%
DFS Furniture (DFS) 296.10p 2.46%
Tullow Oil (TLW) 235.50p 2.08%
Polymetal International (POLY) 847.50p 1.86%
Investec (INVP) 455.40p 1.81%

FTSE 250 - Fallers

Ocado Group (OCDO) 262.80p -5.30%
Interserve (IRV) 319.90p -4.73%
JRP Group (JRP) 140.20p -4.10%
Dechra Pharmaceuticals (DPH) 1,134.00p -3.74%
Sophos Group (SOPH) 191.00p -3.39%
PZ Cussons (PZC) 329.80p -3.14%
CLS Holdings (CLI) 1,553.00p -2.94%
Rotork (ROR) 192.70p -2.28%
Laird (LRD) 336.50p -2.21%
Just Eat (JE.) 450.00p -2.20%