London midday: Miners push equities higher as investors eye non-farm payrolls

UK equities advanced on Friday, bolstered by a rally in mining shares as metal prices reversed declines.

Glencore and Anglo American were the top risers as prices of gold and silver rebounded from an earlier fall, up 0.08% and 0.34% respectively. Although copper prices remained in the red, down 0.68%.

Oil prices were also on the rise with Brent up 0.05% to $34.48 per barrel and West Texas Intermediate up 0.25% to $31.80 per barrel at 1133 GMT.

“An unexpected and sudden weakening in the US dollar on expectations for ongoing low interest rates helped oil prices, gold and other metals to jump,” SP Angel said in a note to investors on Friday.

“We are seeing growing interest in mining stocks from AIM to the FTSE100 with investors looking to buy stocks at the bottom of the current commodity cycle.”

On the economic data front, the US non-farm payrolls report from the Labor Department at 1330 GMT is set to make waves in the market. The report is expected to show US employers added 190,000 jobs in January, marking a slowdown from the previous month’s 292,000 jobs in December.

Average hourly earnings are forecast to have risen 2.2% in the year to January, following a 2.5% increase the previous month. The unemployment rate is projected to remain at 5% in January.

The report follows the private payrolls figures from the ADP on Wednesday, which came in better than expected. It showed employers added 205,000 jobs in January compared to analysts’ forecasts for 195,000.

The Labor Department on Thursday revealed initial jobless claims rose 8,000 to 285,000 in the week to 30 January. Analysts had been expecting 278,000 claims.

The non-farms payrolls report will be once again closely scrutinised by the Federal Reserve as it takes into consideration the health of the labour market in deciding the timing of its next interest rate hike.

“The labour market tightened significantly in 2015, which was the main reason why the Fed raised the target rate in December, as PCE core inflation is still subdued,” according to Danske Bank.

“Since then there has been much uncertainty about the true state of the US economy, as the financial turmoil in the beginning of 2016 partly reflects growth concerns due to monetary tightening and weak data releases.”

Elsewhere, German factory orders fell 0.7% in December compared to a month earlier, which was a steeper decline than the 0.5% expected by economists.

Among corporate stocks, BG Group climbed after reporting fourth quarter adjusted net profit that beat expectations and a 16% increase in exploration and production.

Just Eat jumped after announcing it had ordered four online takeaway food businesses in Spain, Italy, Brazil and Mexico for a total of €125m (£94.7m).

Legal & General Group declined a day after announcing chief financial officer Mark Gregory would be stepping down after 17 years with the company.

Market Movers

FTSE 100 (UKX) 5,914.24 0.26%
FTSE 250 (MCX) 16,180.84 0.59%
techMARK (TASX) 3,056.96 0.09%

FTSE 100 - Risers

Anglo American (AAL) 359.35p 9.46%
Standard Chartered (STAN) 456.95p 4.46%
Glencore (GLEN) 104.10p 4.43%
GKN (GKN) 275.00p 3.73%
Smiths Group (SMIN) 944.50p 3.00%
Aberdeen Asset Management (ADN) 246.70p 2.58%
Kingfisher (KGF) 327.50p 2.47%
Tesco (TSCO) 174.05p 2.44%
easyJet (EZJ) 1,568.00p 2.35%
Royal Bank of Scotland Group (RBS) 247.30p 2.27%

FTSE 100 - Fallers

Rio Tinto (RIO) 1,821.00p -1.99%
Royal Mail (RMG) 440.70p -1.94%
Worldpay Group (WI) (WPG) 301.70p -1.53%
BAE Systems (BA.) 482.30p -1.53%
Inmarsat (ISAT) 1,054.00p -1.31%
Prudential (PRU) 1,247.00p -1.23%
National Grid (NG.) 964.80p -1.21%
Legal & General Group (LGEN) 214.00p -1.02%
Diageo (DGE) 1,810.00p -0.98%
Berkeley Group Holdings (The) (BKG) 3,539.00p -0.81%

FTSE 250 - Risers

Just Eat (JE.) 390.00p 8.33%
Tullow Oil (TLW) 189.10p 5.64%
Pendragon (PDG) 37.19p 5.47%
Countrywide (CWD) 373.40p 4.98%
Workspace Group (WKP) 781.50p 4.97%
Poundland Group (PLND) 148.40p 4.36%
Sophos Group (SOPH) 234.80p 4.36%
Entertainment One Limited (ETO) 143.80p 4.35%
Vedanta Resources (VED) 240.40p 4.11%
Amec Foster Wheeler (AMFW) 428.60p 3.68%

FTSE 250 - Fallers

Hastings Group Holdings (HSTG) 161.80p -2.47%
Woodford Patient Capital Trust (WPCT) 88.00p -2.44%
Lookers (LOOK) 152.60p -2.30%
Domino's Pizza Group (DOM) 930.00p -2.21%
BGEO Group (BGEO) 1,775.00p -2.15%
Enterprise Inns (ETI) 85.15p -2.13%
Dunelm Group (DNLM) 839.00p -2.10%
Indivior (INDV) 139.80p -2.03%
Polymetal International (POLY) 608.50p -2.01%
Thomas Cook Group (TCG) 103.10p -1.81%