Weekly review

The FTSE 100 ended the week down 58.75 points to 6,209.63.

Equity view

British Airways and Iberia parent International Consolidated Airlines said group traffic, as measured in revenue passenger kilometres, rose 14. 1% in May from last year.

The former owners of BHS came under fire on Friday from the leader of one of Britain's biggest business lobby groups, who accused them of “lamentable failures”.

Irish pharmaceuticals company Shire said on Friday that it has completed its $32bn takeover of US-based Baxalta.

BP has settled a lawsuit arising from the 2010 Deepwater Horizon oil spill by agreeing to pay investors who bought American Depository Shares $175m.

Markets operator and provider of post-trade risk mitigation and information services ICAP announced on Friday that China Foreign Exchange Trade System has chosen it to deliver the underlying technology for fixed income and foreign exchange electronic execution services in mainland China.

Johnson & Johnson has agreed to acquire Vogue International, a privately held hair care company, for roughly $3. 3bn cash.

Asia-facing bank Standard Chartered is on track to achieve its $1bn cost-cutting target, says its South Asia chief executive, Ajay Kanwal.

Investec plc announced on Thursday morning its intention to place up to 30. 87 million new ordinary shares in the company, representing 4. 99% of its current issued share capital and 3. 4% of Investec plc and Investec Ltd’s current issued share capital.

A £141m impairment and restructuring charge hit pre-tax profits at chemicals and sustainable technology group Johnson Matthey, which fell to £386. 3m from £495m in a “difficult macroeconomic environment”.

Low-cost airline Ryanair reported a 12% jump in passenger numbers for May.

All four of the major supermarkets - Tesco, Sainsbury, Walmart's Asda and Morrison - endured a year-on-year decline in sales during the last twelve weeks, according Kantar and Nielsen data, though their market share remained solid.

Residential property developer Telford Homes posted a 28% jump in pre-tax profit for the year to the end of March as revenue surged amid strong demand.

Halfords full year numbers were largely flat but ahead of market expectations as new chief executive Jill McDonald claimed to be making progress with her Moving Up A Gear strategy, announcing new capital and debt targets "to allow for appropriate M&A".

Favourable currency movements helped third quarter results at heating and plumbing distributor Wolseley with revenue up 5. 9% at constant exchange rates to £3. 6bn and trading profit up 12. 2% to £230m.

FTSE 250 defence and aerospace group Cobham is looking to raise £506. 7m in a one-for-two underwritten rights issue.

RSA Insurance Group said it had completed the sale of its operations in Mexico to Suramericana SA, the insurance subsidiary of Grupo de Inversiones Suramericana.

Spreadbetting firm IG Group reported solid trading in the fourth quarter and said earnings for the year are set to be slightly ahead of expectations.

UK mortgage lending in April slowed to its lowest monthly level since August 2012, according to the latest figures from the Bank of England.

UK house price growth slowed in May compared to the same month a year ago, Nationwide data revealed on Wednesday.

Economic news

UK services growth picked up in May but remained subdued, according to figures released on Friday. The Markit/CIPS services purchasing managers’ index rose to 53.5 from April’s 38-month low of 52.3, beating expectations for a reading of 52.5.

The pace of UK construction slowed more than expected in May, with new orders down for the first time since April 2013 as many firms held off on placing orders until after the EU referendum, according to data released on Thursday.

The UK economy would be subjected to severe shocks if it left the European Union, with GDP projected to be 3% lower in 2020 than if it remained, the Organisation for Economic Co-operation and Development (OECD) said.

A new Brexit poll showing parity between the Remain and Leave votes saw sterling slip further to a two week low on Wednesday, also hitting equities as housebuilding stocks led the fallers. A YouGov poll for the Times found 41% support for Remain and the same for the Leave camp with the difference being undecided.

An ICM/Guardian telephone poll on Tuesday showed Leave was moving ahead, with 45% of in favour versus 42% support for Remain.

The Markit/CIPS UK manufacturing purchasing managers’ index came in a little better than expected for May. The index pushed up to 50.1 from 49.4 in April, back above the 50 mark that separates contraction from expansion and ahead of economists’ expectations of a reading of 49.6.

UK house price growth slowed in May compared to the same month a year ago, Nationwide data revealed on Wednesday. The annual rate of house price growth was 4.7% in May, down from 4.9% in April and 5.7% in March. Economists had expected a 0.3% gain.

Shop price deflation increased to 1. 8% in May from the 1. 7% decline in April, according to the BRC-Nielsen shop price index.

International events

The US added 38,000 jobs in May, well below the 160,000 that economists had expected, the Labor Department revealed. It marked the weakest performance since September 2010 and compared to a downwardly revised 123,000 jobs in April. The unemployment rate fell to 4.7% in May from 5.0% in April, beating estimates of 4.9%.

The US private sector added 173,000 jobs in May, according to data released by private consultancy ADP.

Data released by Markit pointed to a slowdown in the US services sector in May. The final US services purchasing managers’ index came in at 51.3 in May, up a touch from the flash estimate of 51.2 but down from 52.8 in April. A reading above 50 signals an expansion while a level below that indicates a contraction.

The ISM non-manufacturing composite came in at 52.9 in May, trailing estimates for a reading of 55.4 and following a level of 55.7 in April.

Markit’s final US manufacturing purchasing managers’ index came in at 50. 7 in May, up from the flash estimate of 50. 5 but down from 50. 8 in April and pointing to the weakest performance since September 2009.

Brent crude slid back below $50 as members of the Oil Producing and Exporting Countries (OPEC) failed to agree on output levels at their meeting, although the need to draw inventories down from levels above the five-year average was acknowledged.

The European Central Bank revised its forecasts for inflation and economic growth in 2016 higher on Thursday. At the same time the ECB left its policy unchanged, as expected.

Chinese manufacturing activity growth remain unchanged in May, according to official data on Wednesday. The National Bureau of Statistics said its China manufacturing PMI came in at 50.1 in May, unchanged from the previous month but slightly better than the reading of 50.0 economists were expecting.

US consumer confidence unexpectedly deteriorated in May, according to data from the Conference Board.

Personal consumption in the US jumped last month by the most in almost seven years.

Personal incomes and spending advanced by 0.4% and 1.0% month-on-month in April, according to the Department of Commerce.

The unemployment rate in the Eurozone was 10. 2% in April, unchanged from March and in line with economists' expectations, according to data from Eurostat. The consumer price index fell an annualised 0.1% in May, as expected by analysts, compared to a 0.2% drop in April.