London open: Stocks edge higher despite consumer confidence drop

London stocks opened higher on Friday morning, as a rally from battered blue chips outweighed a sharp drop in consumer confidence data and the usual caution about the looming US non-farm payroll report later in the day.

Even after the oil price bounce that had boosted the prior session evaporated, the FTSE 100 was up 0.14% to 6,543.15 and the FTSE 250 rose 0.41% to 15,963.41 just before 0900 BST on the last trading day in the week.

A consumer confidence survey, conducted by market researcher Gfk in the wake of the Brexit vote between 30 June and 5 July, has found British morale sliding at the fastest pace in 21 years, with shoppers worried about the economic outlook and inflation.

Gfk's headline index dropped eight points to -9, primarily driven by concerns about the economic situation over the next 12 months, which fell to -29 from -14, its lowest level since December 2012, as well as a 12-point decline in consumers’ intent to make major purchases over the next 12 months.

Reflecting on these results, Barclays said it now expects households to materially slow their spending in this and coming years, forecasting a significant deceleration in private consumption growth to 2.0% in 2016 and to 0.1% in 2017, from 2.5% in 2015.

Later on Friday morning, UK trade data is due, with a £10.7bn deficit for May expected, of which only £2.8bn is non-EU.

There was an unstable mood among investors in Europe and US futures trading, said analyst Naeem Aslam at Think Markets, exacerbated by gloomy Japanese trade data and ahead of "the mother of all data" the US Non-Farm Payroll report, which is due at 1330 BST.

"Traders are cautious and we are not seeing much volume for now," Aslam said. "The chief question among traders is what does the word data dependent mean for the Fed and if they are really data dependent? This is what investors will gauge from today’s economic data.

The US non-farm payroll number is expected to come in at 175,000 and anything off this number could spark turmoil in the market, Aslam said.

Ana Thaker, market economist at PhillipCapital, argued that while labour market data is an important release, "Brexit most definitely dominates sentiment and a strong NFP figure is unlikely to change the likelihood of a US rate hike for July".

In UK company news, FTSE 100 group Hammerson and joint venture partner Allianz Real Estate have secured the ownership of Dundrum Town Centre in Ireland, a shopping and leisure destination as part of a portfolio of market-leading retail assets in Dublin, for €1.23bn (£1.01bn). The two partners acquired loans secured against a portfolio of retail assets in September 2015 from the National Asset Management Agency for €1.85bn (£1.53bn), a discount to the face value of the loans.

Aveva Group has announced the stepping down of chief executive Richard Longdon after three decades at the data and IT group, which also said it could benefit from a potentially sizeable currency gain for the full year due to weakness of sterling since the EU referendum. The FTSE 250 engineering data and IT provider, which said Longdon would be replaced by chief financial officer James Kidd at the end of 2016, added that trading had remained satisfactory in recent weeks.

Fellow mid-cap outfit IG announced that it has appointed Paul Mainwaring as chief financial officer designate. The online trading company said Mainwaring will start on Monday, replacing Mark Ward who will leave the company after a short handover, as previously announced.

Market Movers

FTSE 100 (UKX) 6,543.68 0.15%
FTSE 250 (MCX) 15,951.34 0.33%
techMARK (TASX) 3,242.89 0.17%

FTSE 100 - Risers

Taylor Wimpey (TW.) 126.30p 3.44%
Rio Tinto (RIO) 2,396.50p 2.41%
Marks & Spencer Group (MKS) 305.20p 2.11%
Anglo American (AAL) 761.10p 1.96%
Barratt Developments (BDEV) 355.40p 1.80%
Tesco (TSCO) 162.90p 1.69%
Persimmon (PSN) 1,358.00p 1.57%
Prudential (PRU) 1,196.50p 1.44%
GKN (GKN) 270.20p 1.43%
British Land Company (BLND) 571.00p 1.42%

FTSE 100 - Fallers

Royal Dutch Shell 'B' (RDSB) 2,108.50p -0.89%
Coca-Cola HBC AG (CDI) (CCH) 1,541.00p -0.84%
Royal Dutch Shell 'A' (RDSA) 2,080.50p -0.79%
RSA Insurance Group (RSA) 476.10p -0.75%
Pearson (PSON) 941.00p -0.74%
British American Tobacco (BATS) 4,911.00p -0.74%
Intu Properties (INTU) 260.70p -0.72%
Travis Perkins (TPK) 1,308.00p -0.68%
BP (BP.) 450.40p -0.64%
Diageo (DGE) 2,149.50p -0.53%

FTSE 250 - Risers

Inchcape (INCH) 681.50p 6.15%
Vedanta Resources (VED) 481.40p 5.39%
Drax Group (DRX) 338.40p 4.54%
CYBG (CYBG) 222.80p 4.11%
Essentra (ESNT) 579.00p 3.86%
Bovis Homes Group (BVS) 685.00p 3.79%
Kaz Minerals (KAZ) 125.80p 3.28%
Redrow (RDW) 299.80p 3.09%
Hochschild Mining (HOC) 210.50p 2.83%
Circassia Pharmaceuticals (CIR) 100.40p 2.45%

FTSE 250 - Fallers

Sports Direct International (SPD) 266.20p -4.62%
Daejan Holdings (DJAN) 5,050.00p -4.54%
Card Factory (CARD) 300.40p -3.66%
AO World (AO.) 137.10p -3.45%
CMC Markets (CMCX) 276.00p -2.13%
Moneysupermarket.com Group (MONY) 237.50p -2.06%
Aldermore Group (ALD) 111.00p -1.68%
Serco Group (SRP) 110.20p -1.61%
Clarkson (CKN) 1,750.00p -1.41%
Balfour Beatty (BBY) 200.30p -1.28%