London open: Stocks fall as investors digest jobs data; miners in the red

London stocks edged lower in early trade on Tuesday as investors digested the latest UK jobs data, weighed down by weakness in the mining sector and a disappointing update from Ocado.

At 0840 BST, the FTSE 100 was down 0.3% at 7,046.51.

Figures released earlier by the Office for National Statistics showed worker numbers bounced back in August to pre-pandemic levels, while job vacancies hit a record high as the recovery from the Covid-19 crisis continues.

The number of workers on payrolls increased by 241,000 from August to 29.1m, while the number of job vacancies in the June to August period rose 35% to a new record high of 1.03m, with the biggest jump in hiring seen in hotels and restaurants.

Meanwhile, the unemployment rate fell to 4.6% in July from 4.7% the month before, in line with analysts’ expectations.

In the three months to July, average earnings fell to 8.3% from 8.8% but were ahead of expectations of 8.2%.

ONS deputy national statistician Jonathan Athow said: "Early estimates from payroll data suggest that in August the total number of employees is around the same level as before the pandemic, though our surveys show well over a million are still on furlough.

"However, this recovery isn’t even: in hard-hit areas such as London and sectors such as hospitality and arts and leisure, the numbers of workers remain well down on pre-pandemic levels.

"The overall employment rate continues to recover, particularly among groups such as young workers who were hard hit at the outset of the pandemic, while unemployment has fallen.

"Vacancies reached a new record high. Not surprisingly, this is driven above all by hospitality, the sector with the highest proportion of employers reporting their job openings are hard to fill."

In equity markets, Ocado slumped after the online supermarket said sales at Ocado Retail dropped by considerably more than expected over its third quarter, but only due to a conflagration at its customer fulfilment centre at Erith.

Miners were under the cosh as copper prices fell, with BHP, Glencore, Anglo American, Rio Tinto and Antofagasta all lower. Mining giant BHP was also hit by a downgrade to ‘equalweight’ at Barclays.

British Airways and Iberia parent IAG flew lower after a downgrade to ‘neutral’ from ‘outperform’ at BNP Paribas.

On the upside, JD Sports Fashion surged to the top of the FTSE 100 after it reported record first-half results, boosted by pent-up demand after UK stores reopened from lockdown and acquisitions in the US.

Pre-tax profit before exceptional items jumped to £439.5m in the six months to the end of July from £61.9m a year earlier as revenue rose to £3.89bn from £2.54bn. JD said it expected annual headline pre-tax profit for the full year to be at least £750m.

Trainline rallied as it predicted a return to profit in the first half of the year as ticket sales recovered from the damage inflicted early in the pandemic. Group net ticket sales were £666m in the three months to the end of August to stand at 71% of the total two years earlier. In the first half net ticket sales of £1bn were 54% of the level two years earlier.

Market Movers

FTSE 100 (UKX) 7,046.51 -0.31%
FTSE 250 (MCX) 23,809.11 0.14%
techMARK (TASX) 4,685.12 0.13%

FTSE 100 - Risers

JD Sports Fashion (JD.) 1,141.50p 8.82%
Ashtead Group (AHT) 5,918.00p 1.44%
Royal Mail (RMG) 493.60p 1.27%
M&G (MNG) 207.10p 1.17%
SSE (SSE) 1,650.00p 1.13%
InterContinental Hotels Group (IHG) 4,663.00p 1.13%
Bunzl (BNZL) 2,592.00p 0.97%
Kingfisher (KGF) 358.80p 0.93%
B&M European Value Retail S.A. (DI) (BME) 583.80p 0.86%
Barratt Developments (BDEV) 701.80p 0.69%

FTSE 100 - Fallers

Ocado Group (OCDO) 1,795.50p -4.77%
International Consolidated Airlines Group SA (CDI) (IAG) 145.40p -1.96%
BHP Group (BHP) 2,040.50p -1.92%
Glencore (GLEN) 333.60p -1.85%
Anglo American (AAL) 3,037.50p -1.79%
HSBC Holdings (HSBA) 374.40p -1.56%
Rio Tinto (RIO) 5,211.00p -1.44%
Antofagasta (ANTO) 1,438.50p -1.37%
Melrose Industries (MRO) 177.50p -1.20%
Rolls-Royce Holdings (RR.) 110.62p -1.18%

FTSE 250 - Risers

Trainline (TRN) 392.40p 3.81%
Contour Global (GLO) 195.20p 2.31%
Hammerson (HMSO) 34.03p 2.04%
Future (FUTR) 3,746.00p 1.79%
888 Holdings (888) 400.20p 1.68%
WH Smith (SMWH) 1,590.00p 1.63%
Frasers Group (FRAS) 673.50p 1.51%
Countryside Properties (CSP) 531.50p 1.43%
UK Commercial Property Reit Limited (UKCM) 77.30p 1.31%
Cineworld Group (CINE) 64.08p 1.30%

FTSE 250 - Fallers

Ferrexpo (FXPO) 361.20p -4.80%
Restaurant Group (RTN) 120.00p -3.54%
Cairn Energy (CNE) 184.80p -2.17%
Petropavlovsk (POG) 19.83p -1.54%
PureTech Health (PRTC) 345.50p -1.29%
Fidelity China Special Situations (FCSS) 347.50p -1.28%
TP Icap Group (TCAP) 160.00p -1.26%
Hill & Smith Holdings (HILS) 1,862.00p -0.85%
Shaftesbury (SHB) 618.50p -0.80%
Hochschild Mining (HOC) 153.90p -0.77%