London midday: Stocks dip ahead of US jobs data

The FTSE 100 was down 0.2% at 8,256.15.

Joshua Mahony, chief market analyst at Scope Markets, said: "Fears of a burgeoning US recession continue to play out in the background as we move throughout the week, with yesterday’s job opening figures providing the latest in a line of data that leads us towards tomorrow’s jobs report.

"Looking ahead, today promises a fresh bout of volatility for global markets, as the release of ADP payrolls, unemployment claims, and the ISM services PMI provide fresh ammunition for traders to utilize. Following the sharp declines seen in the wake of the ISM manufacturing PMI (accounting for only 9% of the US economy), today’s services read-out should be viewed as a more reliable gauge of economic health going forward. After-all, weakness within the manufacturing sector has been a theme of the past two-years.

"Meanwhile, the ADP payrolls figure is widely expected to stabilize after recent declines took it into a six-month low of 122k. Coming off the back of four consecutive declines in the ADP payrolls figure, the predicted rise to 145k could bring about a relief rally for stocks."

On home shores, a survey showed the construction sector's recovery continued in August, although the rate of expansion eased.

The latest S&P Global UK construction purchasing managers' index was 53.6, below forecasts for 54.9 but comfortably above the neutral 50.0 level. A reading below 50.0 suggests contraction, while one above it indicates growth.

In July, the construction PMI was 55.3, a 26-month high.

S&P Global said firms had reported a "sustained" rebound in total business activity in August, helped by "robust" new order growth and a more supportive economic backdrop.

The index for residential sector - boosted by lower borrowing costs and improving market conditions - came in at 52.7, the highest level since September 2022

The best performing sector remained commercial, however, with the index at 53.7, despite the pace of growth slowing to its lowest since March. The Civil engineering index was 51.8.

Respondents also remained confident looking forward, with 50% expecting a rise in output in the coming year and just 9% forecasting a reduction.

Tim Moore, economics director at S&P Global Market Intelligence, said: "The UK construction sector appears to have turned a corner after a difficult start to 2024, with renewed vigour in the house building segment the most notable development.

"Improving sales pipelines and a turnaround in demand conditions led to a relatively strong degree of business optimism across the sector.

"However, some firms cited a slowdown in civil engineering activity and concerns about the outlook for infrastructure work as constraints on growth expectations."

In equity markets, housebuilder Vistry surged as it announced a further £130m share buyback and posted a 7% increase in first-half pre-tax profit. In the half year to 30 June, pre-tax profit rose to £186.2m from £174m in the same period a year earlier, with total completions up 9.1% to 7,792. Vistry hailed "good demand" across its Partner Funded markets.

Premier Inn owner Whitbread was higher after an upgrade to ‘neutral’ at Redburn, while RS Group was boosted by an upgrade to ‘buy’ at Citi.

Ashmore Group and food manufacturer Bakkavor were also in the black after results.

Currys reversed earlier losses as the electricals retailer posted a jump in sales for the 17 weeks to 24 August as it took a nearly 50% share of the UK laptop market.

On the downside, Admiral, Antofagasta, DS Smith, Aviva, Croda, IAG, Prudential and Ithaca Energy were all weaker as they traded without entitlement to the dividend.

Associated British Foods fell as it said like‐for‐like sales at Primark were expected to fall by around 0.5% in the second half of the financial year, with a projected decline of 0.9% in the fourth quarter due to wet weather in the UK and Ireland which hit footfall and seasonal sales in womenswear and footwear.

Upper Crust and Ritazza owner SSP was hit by a downgrade to ‘equalweight’ at Morgan Stanley.

Market Movers

FTSE 100 (UKX) 8,256.15 -0.16%
FTSE 250 (MCX) 20,860.87 0.25%
techMARK (TASX) 4,855.20 -0.57%

FTSE 100 - Risers

Vistry Group (VTY) 1,383.00p 4.93%
Whitbread (WTB) 3,000.00p 3.48%
Burberry Group (BRBY) 643.20p 3.21%
WPP (WPP) 729.00p 3.14%
Entain (ENT) 631.20p 2.47%
Barclays (BARC) 228.60p 2.19%
Severn Trent (SVT) 2,654.00p 2.04%
Barratt Developments (BDEV) 506.40p 2.04%
Standard Chartered (STAN) 764.80p 1.97%
Land Securities Group (LAND) 651.50p 1.96%

FTSE 100 - Fallers

Associated British Foods (ABF) 2,380.00p -4.84%
Admiral Group (ADM) 2,844.00p -2.97%
Smith (DS) (SMDS) 450.60p -2.89%
Rolls-Royce Holdings (RR.) 468.40p -2.56%
AstraZeneca (AZN) 12,738.00p -2.36%
Halma (HLMA) 2,494.00p -1.97%
BAE Systems (BA.) 1,288.00p -1.87%
Melrose Industries (MRO) 461.80p -1.70%
Relx plc (REL) 3,496.00p -1.63%
Smurfit Westrock (DI) (SWR) 3,448.00p -1.46%

FTSE 250 - Risers

Ashmore Group (ASHM) 180.90p 4.63%
Aston Martin Lagonda Global Holdings (AML) 157.80p 4.30%
Bakkavor Group (BAKK) 160.50p 4.22%
Pennon Group (PNN) 627.00p 4.07%
TBC Bank Group (TBCG) 2,945.00p 3.33%
Indivior (INDV) 935.50p 3.03%
W.A.G Payment Solutions (WPS) 75.00p 2.74%
Great Portland Estates (GPE) 349.00p 2.35%
Currys (CURY) 81.80p 2.25%
Sirius Real Estate Ltd. (SRE) 98.40p 2.18%

FTSE 250 - Fallers

Ithaca Energy (ITH) 118.40p -8.22%
SSP Group (SSPG) 159.20p -6.41%
Alpha Group International (ALPH) 2,380.00p -2.06%
Rathbones Group (RAT) 1,768.00p -2.00%
Plus500 Ltd (DI) (PLUS) 2,548.00p -1.92%
Baltic Classifieds Group (BCG) 285.50p -1.89%
Renishaw (RSW) 3,365.00p -1.75%
Genus (GNS) 1,764.00p -1.67%
Diversified Energy Company (DEC) 854.00p -1.67%
NCC Group (NCC) 148.20p -1.59%