London midday: Stocks fall after mixed UK jobs data

London stocks declined on Wednesday as a mixed UK jobs report failed to inspire and as traders awaited the Federal Reserve’s policy meeting minutes.

Employment rose 44,000 to 31.58 million quarter-on-quarter in the three months to March, beating expectations for no additions, the Office for National Statistics revealed.

Average weekly earnings rose an annualised 2.0% during the period, compared to analysts’ estimates for a 1.7% gain and the previous quarter’s 1.9% year-on-year increase.

The unemployment rate held at 5.1%, as expected but the number of unemployed fell 2,000 in the three months to March.

"This is a softish labour market report overall, but not as bad as feared," said Howard Archer, chief UK and European economist at IHS Global Insight.

"Overall, the labour market data will likely reinforce belief that an interest rate hike by the Bank of England is likely to remain off the table for some considerable time to come – even if there is a vote to remain in the EU in June’s referendum."

Attention now turns to minutes from the Fed’s 26-27 April meeting at 1900 BST. Economists will be searching for clues on whether the Fed will meet expectations to keep interest rates unchanged in June.

However, hawkish remarks from Fed officials in the past two weeks on interest rates have confused economists.

“Confused? Markets certainly are, up one minute and down the next as speculation about the US economy continues to divide opinion, along with speculation about the number of possible rate rises the Fed might decide upon over the course of the remainder of this year,” said Michael Hewson, chief market analyst at CMC Markets.

Elsewhere, data from Eurostat on Wednesday confirmed the eurozone fell back into deflation in April.

Consumer prices fell 0.2% compared to a year ago, in line with the preliminary estimate and consensus, and down from 0.0% in March.

“Today’s results show that inflation in the eurozone is holding steady, but a contracting rather than expanding economy is surely not what Mario Draghi had in mind at this stage of his ECB presidency,” said Dennis de Jong, managing director at UFX.com.

In commodities, oil prices wavered ahead of a report from the Department of Energy on US weekly crude inventories at 1530 BST. Brent crude rose 0.14% to $49.35 per barrel and West Texas Intermediate gained 0.26% to $48.44 per barrel at 1137 BST.

In company news, Burberry slumped after saying full year profits fell 10%, at the bottom of analysts' range of estimates, due to pressures in China.

Chilean copper miner Antofagasta declined as it confirmed that two major development projects have been slowed to preserve cash.

Standard Chartered was under the cosh after Jefferies cut its target price to 330p from 400p and reiterated an ‘underperform’ rating on the Asia-focused bank. Jefferies said it has reduced its revenue expectations for 2016-2018 by 9.5% on “both idiosyncratic and macro induced headwinds” amid a slowdown in China.

ARM Holdings advanced as the chip maker said it has acquired the entire share capital of imaging and embedded computer vision intellectual property company Apical.

Megabrewer SABMiller climbed as it reported 7% organic revenue growth at constant currencies in the year to 31 March.

Food wholesale operator Booker got a boost after Goldman Sachs upgraded the stock to ‘buy’ from ‘neutral’ and lifted the price target to 198p from 171p ahead of the company’s full-year results on Thursday.

Market Movers

FTSE 100 (UKX) 6,144.33 -0.38%
FTSE 250 (MCX) 16,759.90 -0.51%
techMARK (TASX) 3,055.67 -0.49%

FTSE 100 - Risers

Ashtead Group (AHT) 952.00p 2.64%
DCC (DCC) 6,495.00p 1.72%
easyJet (EZJ) 1,459.00p 1.53%
Persimmon (PSN) 2,038.00p 1.39%
Whitbread (WTB) 4,065.00p 1.37%
ARM Holdings (ARM) 940.00p 1.29%
Barclays (BARC) 166.05p 1.10%
Lloyds Banking Group (LLOY) 68.00p 1.07%
Vodafone Group (VOD) 229.15p 0.95%
Berkeley Group Holdings (The) (BKG) 3,087.00p 0.92%

FTSE 100 - Fallers

Anglo American (AAL) 592.30p -5.79%
Burberry Group (BRBY) 1,087.00p -4.90%
Glencore (GLEN) 130.05p -4.73%
Antofagasta (ANTO) 417.40p -3.78%
Rio Tinto (RIO) 1,968.00p -3.24%
BHP Billiton (BLT) 835.20p -3.04%
Standard Chartered (STAN) 502.10p -3.01%
Fresnillo (FRES) 1,134.00p -2.24%
Rolls-Royce Holdings (RR.) 650.50p -2.03%
Mondi (MNDI) 1,317.00p -2.01%

FTSE 250 - Risers

Booker Group (BOK) 175.60p 6.49%
Shawbrook Group (SHAW) 279.00p 5.52%
Allied Minds (ALM) 324.80p 3.37%
Playtech (PTEC) 834.00p 2.58%
Marston's (MARS) 153.20p 2.07%
Ophir Energy (OPHR) 69.15p 1.92%
Greene King (GNK) 866.00p 1.70%
Bovis Homes Group (BVS) 942.00p 1.62%
Mitchells & Butlers (MAB) 278.40p 1.53%
Ladbrokes (LAD) 121.60p 1.50%

FTSE 250 - Fallers

Marshalls (MSLH) 317.50p -8.48%
Meggitt (MGGT) 386.60p -4.24%
Centamin (DI) (CEY) 113.80p -3.80%
Acacia Mining (ACA) 335.80p -3.73%
Kaz Minerals (KAZ) 153.70p -3.58%
Genus (GNS) 1,514.00p -3.57%
DFS Furniture (DFS) 289.60p -3.08%
Entertainment One Limited (ETO) 168.50p -2.94%
Greencore Group (GNC) 371.70p -2.90%
Ocado Group (OCDO) 257.80p -2.86%