London open: Stocks little changed before payrolls; miners hit by China data

London stocks were little changed in early trade as investors looked to the release of the all-important non-farm payrolls report and digested a surprise tightening of monetary policy by the People’s Bank of China.

At 0825 GMT, the FTSE 100 was up 0.1% to 7,148.03.

Investors were waking up to news that China has unexpectedly lifted short-term interest rates. The PBOC raised reverse repurchase agreements by ten basis points to 2.35%.

Meanwhile, mining stocks took a beating following the release of disappointing manufacturing data out of China. The Caixin manufacturing purchasing managers' index, a private gauge of factory activity, nudged down to 51.0 in January from 51.9 in December. This remained out of contraction territory for a seventh straight month but was below economists’ forecasts of 51.2.

Looking ahead, the main focus on Friday will be the US non-farm payrolls report and unemployment rate at 1330 GMT.

CMC Markets’ Michael Hewson said: “We round off the day and the week with expectations high that today’s US employment report will blow the doors off in the same way as Wednesday’s 245k ADP number did. These expectations aren’t unrealistic given that over the last 12 months the ADP and official NFP numbers have only deviated by more than 30k on just two occasions, with an average change of 14k over the last 12 months.

"This would suggest that the 180k estimate being predicted is probably too low, with a figure in excess of 200k not being beyond the realms of possibility. Such a high number given an unemployment rate of 4.7%, would suggest that there is probably still a fair degree of slack in the jobs market. Wages are also likely to be closely watched with a rise of 0.3% expected, with an annualised rise of 2.8%, down slightly from December’s 2.9%.”

Ahead of the US data, investors will eye the release of Markit’s UK services PMI at 0930 GMT.

On the corporate front, residential repair and improvements business HomeServe gained as it said it has acquired shareholdings in Checkatrade in the UK and Habitissimo in Spain. The FTSE 250 company purchased a 40% interest in Checkatrade, and a 70% interest in Habitissimo, with the deals being worth a combined £37m.

Elsewhere, buyout fund Electra Private Equity was in the black as its portfolio manager Epiris said it will sell its Audiotonix business, which manufactures audio mixing consoles, to European private equity firm Astorg.

Insurer Beazley surged after reporting a 3% jump in full-year profit as gross premiums written increased 6% and the company lifted its dividend.

Budget airline Ryanair flew higher as it said traffic in January rose 17% to 8.77m, while the load factor – which gauges how full the planes are – nudged up to 90% form 88%.

Halma was a high riser after Barclays upgraded its stance on the stock to ‘overweight’ from ‘equalweight’.

Market Movers

FTSE 100 (UKX) 7,148.03 0.10%
FTSE 250 (MCX) 18,319.38 0.33%
techMARK (TASX) 3,264.35 0.35%

FTSE 100 - Risers

British Land Company (BLND) 587.00p 1.12%
Reckitt Benckiser Group (RB.) 7,182.00p 1.03%
Hikma Pharmaceuticals (HIK) 1,931.00p 0.99%
ITV (ITV) 203.50p 0.99%
Taylor Wimpey (TW.) 173.10p 0.93%
Associated British Foods (ABF) 2,398.00p 0.93%
Barclays (BARC) 223.20p 0.84%
Marks & Spencer Group (MKS) 341.70p 0.83%
Mediclinic International (MDC) 770.50p 0.72%
GlaxoSmithKline (GSK) 1,548.50p 0.72%

FTSE 100 - Fallers

Anglo American (AAL) 1,329.50p -3.48%
Rio Tinto (RIO) 3,412.00p -2.93%
Antofagasta (ANTO) 818.00p -2.68%
Glencore (GLEN) 316.55p -2.60%
BHP Billiton (BLT) 1,400.00p -2.30%
Fresnillo (FRES) 1,456.00p -1.89%
Smurfit Kappa Group (SKG) 2,139.00p -1.06%
Mondi (MNDI) 1,754.00p -0.96%
Admiral Group (ADM) 1,782.00p -0.61%
Paddy Power Betfair (PPB) 8,490.00p -0.53%

FTSE 250 - Risers

Halma (HLMA) 954.00p 3.02%
Telecom Plus (TEP) 1,246.00p 2.64%
CMC Markets (CMCX) 111.60p 2.39%
Lancashire Holdings Limited (LRE) 682.50p 1.94%
Homeserve (HSV) 610.50p 1.83%
Paysafe Group (PAYS) 395.10p 1.78%
Wizz Air Holdings (WIZZ) 1,583.00p 1.47%
National Express Group (NEX) 342.30p 1.45%
Tullow Oil (TLW) 300.50p 1.35%
Electrocomponents (ECM) 495.50p 1.33%

FTSE 250 - Fallers

Vedanta Resources (VED) 1,050.00p -3.49%
Evraz (EVR) 230.70p -3.11%
Metro Bank (MTRO) 3,396.00p -1.57%
Jardine Lloyd Thompson Group (JLT) 1,007.00p -1.37%
Kaz Minerals (KAZ) 498.70p -1.35%
Hochschild Mining (HOC) 237.40p -1.25%
Shawbrook Group (SHAW) 243.00p -1.22%
Acacia Mining (ACA) 431.20p -1.12%
Worldwide Healthcare Trust (WWH) 2,150.00p -0.74%
Debenhams (DEB) 53.65p -0.65%