London midday: Stocks fall ahead of all-important US non-farm payrolls report

London stocks fell on Friday as investors awaited the US non-farm payrolls report and prepared for a widely expected interest rate hike by the Federal Reserve.

At midday, the FTSE 100 was down 1.0% to 6,685.42.

The non-farm payrolls data, released at 1330 GMT, is expected to show employers added 180,000 jobs in November. The unemployment rate is forecast to remain at 4.9%, while average hourly earnings are estimated to have grown 2.8% year-on-year and 0.2% month-on-month.

“While the November jobs report is not necessarily being talked about with the same importance as some in the past, due to a rate hike being almost 100% priced in next week, it continues to be an extremely important economic release and should not therefore be overlooked,” said Oanda’s Craig Erlam.

“It’s very unlikely that today’s numbers will have any influence on the decision in a couple of weeks, not if recent commentary from the Fed is anything to go by, but it along with others will influence the pace of tightening next year and beyond.”

The Fed meets on 13-14 December to decide on interest rates.

On this side of the pond, data showed the UK construction sector expanded further in November with business activity and incoming new work increasing at the strongest pace in eight months.

The Markit/CIPS purchasing managers’ index rose to 52.8 in November from 52.6 in October, beating forecasts for a reading of 52.2. A level above 50 signals an expansion in sector activity while a figure below that indicates a contraction.

However, average cost burdens rose sharply with the rate of inflation the steepest since April 2011.

The pound rose 0.15% against the dollar to $1.2610 at 1119 GMT.

Meanwhile, oil prices reversed their OPEC-fuelled rally after the cartel agreed to cut production on Wednesday, as traders awaited the Baker Hughes rig count report at 1800 GMT. Brent crude fell 1.2% to $53.28 per barrel and West Texas Intermediate dropped 1.06% to $50.52 per barrel at 1121 GMT.

Among corporate stocks, property shares were boosted by the better-than-forecast UK construction PMI data. Land Securities, British Land and Hammerson rallied.

Berkeley Group was also on the front foot after the property developer reported an increase in first half earnings and revenue that beat forecasts.

Heading in the opposite direction, Laird plummeted after proposing to raise £185m through a rights issue and scrapping its final dividend in a bid to strengthen its financial position.

Mining stocks were under the cosh, including BHP Billiton, Antofagasta and Rio Tinto, as copper and silver prices fell.

Market Movers

FTSE 100 (UKX) 6,685.42 -1.00%
FTSE 250 (MCX) 17,367.20 -0.74%
techMARK (TASX) 3,193.92 -0.70%

FTSE 100 - Risers

Land Securities Group (LAND) 952.00p 1.38%
British Land Company (BLND) 586.00p 1.12%
Shire Plc (SHP) 4,598.50p 0.97%
Royal Mail (RMG) 458.70p 0.77%
Imperial Brands (IMB) 3,367.00p 0.66%
Direct Line Insurance Group (DLG) 344.60p 0.29%
Hammerson (HMSO) 534.00p 0.28%
SSE (SSE) 1,458.00p 0.28%
BT Group (BT.A) 354.15p 0.27%
Barratt Developments (BDEV) 468.70p 0.26%

FTSE 100 - Fallers

BHP Billiton (BLT) 1,284.00p -4.11%
Antofagasta (ANTO) 680.00p -3.61%
Glencore (GLEN) 275.20p -2.94%
Rolls-Royce Holdings (RR.) 662.00p -2.93%
Barclays (BARC) 212.75p -2.88%
Rio Tinto (RIO) 2,941.00p -2.87%
Sage Group (SGE) 631.00p -2.70%
Anglo American (AAL) 1,175.00p -2.69%
ITV (ITV) 165.50p -2.65%
Hikma Pharmaceuticals (HIK) 1,635.00p -2.21%

FTSE 250 - Risers

Berkeley Group Holdings (The) (BKG) 2,690.00p 5.70%
Hochschild Mining (HOC) 219.00p 2.62%
Serco Group (SRP) 135.90p 2.57%
AO World (AO.) 174.70p 2.10%
BGEO Group (BGEO) 3,100.00p 2.04%
Grainger (GRI) 219.40p 1.81%
TalkTalk Telecom Group (TALK) 154.90p 1.57%
Daejan Holdings (DJAN) 5,910.00p 1.55%
CMC Markets (CMCX) 185.60p 1.37%
IP Group (IPO) 143.40p 1.34%

FTSE 250 - Fallers

Laird (LRD) 135.90p -10.30%
Euromoney Institutional Investor (ERM) 1,112.00p -6.63%
Evraz (EVR) 229.30p -6.18%
GVC Holdings (GVC) 624.50p -4.95%
Restaurant Group (RTN) 320.30p -3.29%
Aggreko (AGK) 819.00p -3.13%
Just Eat (JE.) 570.00p -2.90%
Playtech (PTEC) 812.50p -2.64%
Dignity (DTY) 2,407.00p -2.59%
Tullow Oil (TLW) 307.30p -2.57%