London close: Stocks finish mixed as oil prices advance

London markets ended mixed on Wednesday, with energy stocks providing support to the top-flight index amid rising geopolitical tensions in the Middle East.

The FTSE 100 index rose 0.17% to close at 8,290.86 points, while the FTSE 250 fell 0.63% to 20,783.78 points.

On the currency front, sterling slipped 0.08% on the dollar to trade at $1.3275, while it gained 0.06% against the euro, changing hands at €1.2011.

Chris Beauchamp, chief market analyst at IG, said that a “calm reaction” was prevailing across markets following Tuesday’s events, adding that a stronger US private payroll report was boosting sentiment.

“Global markets, and indeed the international community, are on tenterhooks as they await an Israeli response to Iran’s attacks yesterday,” he said.

“This is unlikely to be a repeat of last time, given the geopolitical implications, and thus today’s calm reaction by investors may not last.”

Developments in the Middle East had the potential to trump the week’s payrolls report, Beauchamp added, adding that Wednesday’s stronger ADP figure had helped to steady skittish nerves for the moment, however.

“Expectations of another bumper cut have been reined in for now, a development that investors appear to have taken in their stride.”

US private sector grows more than expected, oil prices rise

In economic news, US private sector employment saw stronger-than-expected growth in September, according to fresh data from ADP.

Job gains reached 143,000, surpassing forecasts of a 125,000 increase.

Additionally, August's employment growth was revised upward to 103,000 from 99,000.

Job creation was uneven across business sizes, with small businesses shedding 8,000 positions, while medium-sized firms added 64,000 jobs and large companies created 86,000.

The service sector contributed 101,000 new jobs, while the goods-producing sector saw a 42,000 rise.

However, wage growth slowed, with year-on-year pay increases for job-stayers dipping to 4.7%, and for job-changers, easing to 6.6%, down from 7.3% in August.

“Stronger hiring didn't require stronger pay growth last month,” said Nela Richardson, chief economist at ADP.

“Typically, workers who change jobs see faster pay growth.

“But their premium over job-stayers shrank to 1.9%, matching a low we last saw in January.”

US mortgage applications meanwhile fell by 1.3% in the week ending 27 September, according to the Mortgage Bankers Association.

It marked the first decline in over a month.

Refinancing applications dropped by 3%, though they remained significantly higher than a year ago, while purchase applications edged up by 1%.

The movement aligned with stabilising mortgage rates, which inched up one basis point after hitting a two-year low of 6.13%.

Elsewhere, oil prices continued to rise amid growing fears of an escalating conflict in the Middle East.

Brent crude was last up 0.38% at $73.84 per barrel, while West Texas Intermediate rose 0.49% to $70.17.

Markets reacted to a missile attack on Israel by Iran, which followed Israel’s ground offensive against Hezbollah.

Closer to home, eurozone unemployment remained stable at a record-low 6.4% in August, according to Eurostat.

The jobless rate, which first hit that level in July, was consistent with expectations, while the total number of unemployed fell to 10.93 million, marking a reduction of 94,000 from the previous month.

Youth unemployment also saw a slight decrease, falling to 14.1%.

Across the European Union, the unemployment rate declined to 5.9% from 6.0% in July.

Spain continued to record the highest unemployment rate at 11.3%, while Malta had the lowest at 3.0%.

Oil plays and miners in the green, JD Sports falls

On London’s equity markets, shares in Asia-focused Prudential rose 4.16%, continuing their climb following China's recent stimulus measures.

Similarly, Fidelity China Special Situations added 4.25%, benefiting from the surge in Chinese markets sparked by the government's economic support initiatives.

Oil giants BP and Shell were also among the risers, gaining 2.14% and 2.82% respectively, as oil prices climbed amid escalating tensions in the Middle East.

Miners followed suit, with Rio Tinto up 1.62%, Anglo American rising 1.4%, Glencore advancing 1.57%, and Antofagasta edging up 0.05%.

The increases came as oil and gold prices reacted to fears of a wider conflict in the region.

FTSE 250 energy stocks Ithaca Energy and Harbour Energy also performed well, gaining 5.58% and 2.69% respectively, while Hochschild Mining added 1.38%.

Defence companies BAE Systems and Babcock International were also in the green, rising 1.96% and 1.28%, as geopolitical tensions spurred investor interest in the sector.

Elsewhere, Saga surged 9.06% after confirming talks with Belgian insurer Ageas over a potential partnership for its insurance business.

On the downside, JD Sports Fashion dropped 6.12% despite posting a 2% rise in half-year profit, with market sentiment likely impacted by Nike's recent revenue warning.

Wizz Air Holdings also struggled, falling 6.8% after reporting a slight dip in load factors for September despite increased capacity, following ongoing engine-related disruptions to its Airbus A321neo fleet.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 8,290.86 0.17%
FTSE 250 (MCX) 20,783.78 -0.63%
techMARK (TASX) 4,849.84 0.03%

FTSE 100 - Risers

Prudential (PRU) 720.40p 4.16%
Coca-Cola HBC AG (CDI) (CCH) 2,726.00p 3.34%
Standard Chartered (STAN) 795.40p 2.08%
BAE Systems (BA.) 1,298.50p 1.96%
Shell (SHEL) 2,521.00p 1.74%
HSBC Holdings (HSBA) 676.00p 1.70%
Fresnillo (FRES) 632.00p 1.61%
Anglo American (AAL) 2,478.00p 1.43%
BP (BP.) 406.60p 1.40%
Rio Tinto (RIO) 5,371.00p 1.38%

FTSE 100 - Fallers

JD Sports Fashion (JD.) 140.35p -6.12%
easyJet (EZJ) 484.00p -3.51%
Severn Trent (SVT) 2,609.00p -3.01%
Vistry Group (VTY) 1,286.00p -2.94%
United Utilities Group (UU.) 1,037.00p -2.54%
Marks & Spencer Group (MKS) 368.40p -2.31%
Land Securities Group (LAND) 638.00p -2.30%
International Consolidated Airlines Group SA (CDI) (IAG) 190.90p -2.20%
Entain (ENT) 753.20p -2.00%
SSE (SSE) 1,874.00p -1.96%

FTSE 250 - Risers

Ithaca Energy (ITH) 113.60p 5.58%
Fidelity China Special Situations (FCSS) 233.00p 4.25%
Indivior (INDV) 755.00p 3.85%
Harbour Energy (HBR) 278.60p 2.69%
Schroder Asia Pacific Fund (SDP) 561.00p 2.56%
Pacific Horizon Inv Trust (PHI) 613.00p 2.51%
Schroder Oriental Income Fund Ltd. (SOI) 279.50p 2.01%
W.A.G Payment Solutions (WPS) 82.00p 1.99%
Bank of Georgia Group (BGEO) 3,595.00p 1.69%
Hochschild Mining (HOC) 190.80p 1.60%

FTSE 250 - Fallers

Energean (ENOG) 836.00p -8.03%
Close Brothers Group (CBG) 371.80p -7.65%
Aston Martin Lagonda Global Holdings (AML) 108.50p -7.42%
Wizz Air Holdings (WIZZ) 1,276.00p -6.66%
Helios Towers (HTWS) 109.00p -4.22%
Hammerson (HMSO) 308.00p -4.11%
Derwent London (DLN) 2,348.00p -3.37%
Discoverie Group (DSCV) 586.00p -3.30%
Safestore Holdings (SAFE) 878.00p -3.25%
Marshalls (MSLH) 315.50p -3.07%