London open: Stocks rise after UK jobs data, ahead of US inflation

London stocks rose in early trade on Tuesday as investors mulled the latest UK jobs numbers and looked ahead to the release of US inflation figures.

At 0840 GMT, the FTSE 100 was 0.4% firmer at 7,982.75, heading towards the 8,000 mark, having hit a fresh record high.

Data released earlier by the Office for National Statistics showed that regular pay grew more than expected in the final three months of last year, but real pay kept falling.

The unemployment rate was stable at 3.7% in December, while annual wage growth rose by 6.7% in the period between October and December, up from 6.5% and ahead of expectations for it to remain flat. The ONS said this was the fastest rate of growth seen outside of the pandemic.

Taking into account inflation, however, this marked a 2.5% decline.

Growth in average total pay including bonuses was 5.9%, down from 6.5%. Taking into account inflation, this was a 3.1% decline. "This is smaller than the record fall in real total pay we saw in February to April 2009 (4.5%), but remains among the largest falls in growth since comparable records began in 2001," the ONS said.

The number of people in employment rose by 74,000 in the period between October and December to 32.8m, taking the employment rate to 75.6%, up 0.2 percentage points.

The data showed that 843,000 working days were lost in December because of strike action, which is the highest since November 2011. It also showed that In November 2022 to January 2023, vacancies fell by 76,000 on the quarter to 1,134,000, marking the seventh consecutive quarterly fall since May to July 2022.

"The fall in the number of vacancies reflects uncertainty across industries, as survey respondents continue to cite economic pressures as a factor in holding back on recruitment," the ONS said.

Capital Economics said: "December’s labour market data showed that, despite an easing in labour demand, labour market conditions stayed tight and the market continues to support strong wage growth.

"The Bank of England will be increasingly concerned about the persistence of domestic inflationary pressures as private sector wage growth (excluding bonuses) exceeded its forecast. This supports our view that the Bank of England will have to raise interest rates from 4.00% now to a peak of 4.50% in the coming months."

In equity markets, Coca-Cola HBC was the top gainer on the FTSE 100 after well-received full-year results, while Vodafone rallied after Liberty Global bought a 4.9% stake in the company.

Plus 500 was higher after posted a 16% jump in full-year revenues to $832.6m, and a 17% increase in earnings before interest, taxes, depreciation and amortisation to $453m.

Holiday operator TUI gained after it said summer bookings were up 20% and reported a narrowing of first-quarter losses, as travel continued to rebound from the effects of the Covid pandemic.

Gambling company Flutter Entertainment rose after saying it was considering a US listing and would starting consulting shareholders on the matter as its FanDuel operation grew in importance to the group.

Market Movers

FTSE 100 (UKX) 7,982.75 0.44%
FTSE 250 (MCX) 20,191.38 0.33%
techMARK (TASX) 4,594.42 0.61%

FTSE 100 - Risers

Coca-Cola HBC AG (CDI) (CCH) 2,014.00p 3.73%
BT Group (BT.A) 137.30p 2.39%
Airtel Africa (AAF) 126.20p 1.94%
Flutter Entertainment (CDI) (FLTR) 12,785.00p 1.91%
Vodafone Group (VOD) 95.63p 1.73%
Persimmon (PSN) 1,453.50p 1.22%
Intertek Group (ITRK) 4,484.00p 1.17%
Hargreaves Lansdown (HL.) 945.20p 1.00%
Taylor Wimpey (TW.) 119.25p 0.97%
Centrica (CNA) 98.86p 0.94%

FTSE 100 - Fallers

Rolls-Royce Holdings (RR.) 108.56p -0.82%
Pershing Square Holdings Ltd NPV (PSH) 2,970.00p -0.67%
HSBC Holdings (HSBA) 610.50p -0.52%
InterContinental Hotels Group (IHG) 5,486.00p -0.44%
Endeavour Mining (EDV) 1,850.00p -0.38%
Prudential (PRU) 1,290.00p -0.27%
Admiral Group (ADM) 2,228.00p -0.27%
Antofagasta (ANTO) 1,707.50p -0.26%
Haleon (HLN) 330.95p -0.21%
Unite Group (UTG) 1,012.00p -0.20%

FTSE 250 - Risers

Drax Group (DRX) 648.50p 3.43%
Tritax Eurobox (GBP) (EBOX) 73.00p 3.40%
Aston Martin Lagonda Global Holdings (AML) 192.90p 2.77%
easyJet (EZJ) 483.00p 2.72%
Mitchells & Butlers (MAB) 169.10p 2.42%
C&C Group (CDI) (CCR) 163.20p 2.32%
ASOS (ASC) 844.00p 2.30%
Plus500 Ltd (DI) (PLUS) 1,949.00p 2.15%
RHI Magnesita N.V. (DI) (RHIM) 2,764.00p 1.92%
Bellway (BWY) 2,190.00p 1.91%

FTSE 250 - Fallers

Bakkavor Group (BAKK) 111.00p -1.77%
Murray Income Trust (MUT) 866.00p -1.25%
NB Private Equity Partners Ltd. (NBPE) 1,670.00p -1.18%
BH Macro Ltd. GBP Shares (BHMG) 444.00p -1.11%
Murray International Trust (MYI) 1,326.00p -1.04%
RIT Capital Partners (RCP) 2,000.00p -0.99%
Auction Technology Group (ATG) 708.00p -0.98%
Bankers Inv Trust (BNKR) 105.00p -0.94%
Dunelm Group (DNLM) 1,166.00p -0.93%
Edinburgh Worldwide Inv Trust (EWI) 177.60p -0.89%