London close: Stocks sink as UK jobless rate rises

The FTSE 100 index closed down 1.22% at 8,025.77 points, while the FTSE 250 shed 1.43% to finish at 20,427.80 points.

In currency markets, sterling was last down 1.03% on the dollar to trade at $1.2736, as it slipped 0.49% against the euro, changing hands at €1.2017.

“Disappointing German investor morale on top of US tariff concerns triggered a sell-off in European shares,” said IG senior technical analyst Axel Rudolph.

“Asian stocks remained under pressure as the latest China stimulus package underwhelmed.

“This put pressure on European stock indices, most of which fell by around 2% on the day, also weighed down by disappointing German ZEW sentiment data.”

Rudolph noted that in the US, however, consumer sentiment hit a 39-month high while small business optimism rose in October, although US stocks also dipped slightly.

“The oil price began to level out, following several days of steep losses amid ample supply and an appreciating US dollar.

“Among other crosses AUD-USD, EUR-USD and GBP-USD tumbled to multi-month lows ahead of Wednesday's US CPI print.”

UK unemployment climbs past expectations, grocery sales surge

In economic news, UK unemployment inched up to 4.3% in the three months to September, according to fresh figures from the Office for National Statistics (ONS), surpassing the expected rise to 4.1% and marking an increase from 4% in the prior quarter.

Wage growth showed signs of cooling, with regular pay excluding bonuses increasing by 4.8% year-over-year, the slowest pace since June 2022.

Including bonuses, earnings rose 4.3% from 3.8%, largely influenced by one-off civil service payments over the summer.

“Growth in pay excluding bonuses eased again this month to its lowest rate in over two years,” said ONS director of economic statistics Liz McKeown.

“Pay growth including bonuses increased, but for recent periods these figures have been affected by last year’s one-off payments made to public sector workers.

“Job vacancies have fallen again, as they have been doing for more than two years now; however the total still remains a little above where it was before the pandemic.”

Meanwhile, UK grocery sales surged to their highest level in October, fueled by increased shopping activity and seasonal demand.

Data from Kantar showed that take-home grocery sales reached £11.6bn in the four weeks to 3 November - a 2% rise from last year.

Shopping trips climbed to 480 million, the highest count since March 2020, as Halloween purchases, including 3.2 million pumpkins and heightened confectionery sales, contributed to the uptick.

Early Christmas buying was also noted, with 14.4% of households purchasing mince pies and nearly 650,000 picking up a Christmas cake.

“What’s interesting this month is the number of households who are already stocking up the cupboards for the big day in December,” said Fraser McKevitt, head of retail and consumer insight at Kantar.

“Some people think Christmas ads hit our screens too soon but it’s clearly important for retailers to set out their stalls early.

“Spending on deals has been going up consistently for the past 18 months and it now makes up 28.6% of all sales; offers are helping to lift branded sales especially.”

On the continent, German inflation continued its upward trend, driven by food price increases and sustained inflation in services.

Official data confirmed a 2% rise in the consumer price index in October, up from 1.6% in September, though energy prices had a less dampening effect than in prior months.

However, business sentiment in the country appeared to be weakening, with the ZEW investor expectations index dropping to 7.4 in November from 13.1 in October.

The current conditions index also declined, falling to -91.4, indicating ongoing challenges in Europe’s largest economy.

Vodafone falls, DCC soars on strategic shift

On London’s equity markets, Vodafone Group dropped 6.21% despite reaffirming its full-year guidance, as the telecom giant noted that first-half results met expectations.

Fresnillo shares slid by 7.84% after partner Industrias Peñoles reported operational issues at the Sabinas mine, affecting silver production.

Burberry Group also declined sharply, down 5.99%, as hopes of a takeover faded.

Reports surfaced late on Monday that Italian luxury brand Moncler was not in talks to acquire the British fashion house, quelling a brief surge sparked by rumours of a potential deal in the weekend press.

Promotional products supplier 4imprint Group fell 8.02% despite highlighting a strong financial performance through October, amid broader market challenges.

Direct Line Insurance Group dropped 4.98% after a downgrade by Jefferies, which slashed the stock's price target from 235p to 165p.

Melrose Industries, BAE Systems, Bank of Georgia Group, and Renewi also traded lower on mixed corporate updates.

In contrast, wound care specialist Convatec Group surged 22.07% as it raised its 2024 guidance following strong sales across its divisions.

DCC soared 14.18% on news of a strategic shift to focus on the energy sector, supported by an interim profit increase and a dividend hike.

AstraZeneca saw modest gains of 0.05% after upgrading its full-year guidance, citing robust growth across core therapy areas.

Drax Group rose 3.82%, boosted by expectations that full-year earnings would land at the top end of analyst estimates, underscoring investor confidence in its outlook.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 8,025.77 -1.22%
FTSE 250 (MCX) 20,427.80 -1.43%
techMARK (TASX) 4,598.79 -1.26%

FTSE 100 - Risers

Convatec Group (CTEC) 264.40p 22.07%
DCC (CDI) (DCC) 5,670.00p 14.18%
Rightmove (RMV) 607.60p 2.64%
Smith & Nephew (SN.) 956.20p 1.96%
Centrica (CNA) 117.95p 1.07%
Diploma (DPLM) 4,522.00p 0.62%
British American Tobacco (BATS) 2,756.00p 0.58%
F&C Investment Trust (FCIT) 1,112.00p 0.36%
Flutter Entertainment (DI) (FLTR) 19,270.00p 0.23%
Auto Trader Group (AUTO) 791.20p 0.23%

FTSE 100 - Fallers

Vodafone Group (VOD) 67.02p -8.19%
Fresnillo (FRES) 623.00p -7.84%
Vistry Group (VTY) 713.50p -5.56%
Prudential (PRU) 608.00p -5.21%
Anglo American (AAL) 2,220.00p -4.58%
Croda International (CRDA) 3,625.00p -4.43%
easyJet (EZJ) 521.40p -3.80%
Airtel Africa (AAF) 94.60p -3.72%
Glencore (GLEN) 376.45p -3.10%
WPP (WPP) 827.80p -2.79%

FTSE 250 - Risers

Kainos Group (KNOS) 881.00p 4.38%
Drax Group (DRX) 666.50p 3.82%
PureTech Health (PRTC) 172.20p 1.89%
Raspberry PI Holdings (RPI) 335.70p 1.73%
Trustpilot Group (TRST) 272.50p 1.11%
Bytes Technology Group (BYIT) 462.60p 1.05%
XPS Pensions Group (XPS) 366.00p 0.83%
Baillie Gifford US Growth Trust (USA) 244.00p 0.83%
3i Infrastructure (3IN) 338.50p 0.59%
Harworth Group (HWG) 171.00p 0.59%

FTSE 250 - Fallers

Wood Group (John) (WG.) 54.85p -10.89%
4Imprint Group (FOUR) 4,995.00p -8.18%
Burberry Group (BRBY) 731.40p -5.99%
Close Brothers Group (CBG) 196.00p -5.41%
SSP Group (SSPG) 153.00p -5.32%
Wizz Air Holdings (WIZZ) 1,433.00p -5.16%
Helios Towers (HTWS) 107.00p -5.14%
Direct Line Insurance Group (DLG) 152.60p -4.98%
Pennon Group (PNN) 533.00p -4.91%
Oxford Instruments (OXIG) 2,035.00p -4.46%