London open: FTSE flat ahead of non-farm payrolls

The FTSE 100 opened flat on Friday as investors erred on the side of caution ahead of the US non-farm payrolls report.

The Labor Department’s non-farm payrolls report at 1330 GMT 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 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 jobs.

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 reports 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, beating expectations for a 0.5% decline.

Meanwhile, oil prices declined with Brent down 1.1% $34.08 per barrel and West Texas Intermediate down 0.6% to $31.51 per barrel at 0904 GMT.

In company news, mining stocks reversed the previous session’s gains as metal prices fell including gold (-0.16%), silver (-0.07%) and copper (-0.91%). Glencore, Anglo American and Rio Tinto were among the biggest fallers.

BG Group’s shares climbed after saying upstream production rose 16% during the year to 31 December, to 704,000 barrels of oil equivalent per day.

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).

Market Movers

FTSE 100 (UKX) 5,897.58 -0.02%
FTSE 250 (MCX) 16,100.17 0.08%
techMARK (TASX) 3,060.76 0.21%

FTSE 100 - Risers

Kingfisher (KGF) 324.00p 1.38%
Babcock International Group (BAB) 899.50p 1.24%
Tesco (TSCO) 172.00p 1.24%
Coca-Cola HBC AG (CDI) (CCH) 1,338.00p 1.21%
Sage Group (SGE) 614.00p 1.07%
Vodafone Group (VOD) 212.45p 1.05%
easyJet (EZJ) 1,548.00p 1.04%
InterContinental Hotels Group (IHG) 2,313.00p 0.96%
Unilever (ULVR) 2,980.50p 0.91%
Associated British Foods (ABF) 3,162.00p 0.86%

FTSE 100 - Fallers

Glencore (GLEN) 95.74p -3.95%
Anglo American (AAL) 318.30p -3.05%
Rio Tinto (RIO) 1,814.00p -2.37%
BAE Systems (BA.) 481.30p -1.74%
BHP Billiton (BLT) 700.50p -1.70%
Barclays (BARC) 171.40p -1.30%
Antofagasta (ANTO) 425.10p -1.21%
DCC (DCC) 5,145.00p -1.06%
Legal & General Group (LGEN) 214.10p -0.97%
Johnson Matthey (JMAT) 2,324.00p -0.81%

FTSE 250 - Risers

Just Eat (JE.) 397.60p 10.44%
Sophos Group (SOPH) 230.80p 2.58%
Pendragon (PDG) 36.08p 2.33%
Zoopla Property Group (WI) (ZPLA) 215.00p 2.23%
CLS Holdings (CLI) 1,541.00p 2.05%
P2P Global Investments C (P2P2) 934.50p 1.58%
Circassia Pharmaceuticals (CIR) 276.40p 1.47%
TR Property Inv Trust (TRY) 280.90p 1.33%
BTG (BTG) 571.00p 1.33%
Shawbrook Group (SHAW) 293.50p 1.31%

FTSE 250 - Fallers

Just Retirement Group (JRG) 133.00p -2.71%
Woodford Patient Capital Trust (WPCT) 88.00p -2.44%
Aggreko (AGK) 802.00p -2.14%
Investec (INVP) 432.70p -2.10%
Thomas Cook Group (TCG) 102.80p -2.10%
Polymetal International (POLY) 609.50p -1.85%
Ibstock (IBST) 207.00p -1.80%
Vedanta Resources (VED) 226.80p -1.78%
Hastings Group Holdings (HSTG) 163.30p -1.57%
AO World (AO.) 157.50p -1.56%