London open: Frasers Group paces gains as investors mull jobs data

At 0840 BST, the FTSE 100 was up 0.9% at 8,262.09.

Data released earlier by the Office for National Statistics showed that wages grew at their slowest pace in nearly two years in the three months to May.

Annual pay excluding bonuses was up 5.7%, down from 6% growth in the previous three-month period. This was in line with economists’ expectations and marked the slowest pace of growth since September 2022.

Including bonuses, total earnings rose 5.7%, down from 5.9% and also as expected.

Meanwhile, the unemployment rate was steady at 4.4% in May, in line with expectations.

The data also showed that job vacancies fell from 905,000 in the three months to May to 889,000 in the three months to June, leaving them 32% below the peak in May 2022.

Liz McKeown, ONS director of economic statistics, said: "We continue to see overall some signs of a cooling in the labour market, with the growth in the number of employees on the payroll weakening over the medium term and unemployment gradually increasing.

"Earnings growth in cash terms, while remaining relatively strong, is showing signs of slowing again. However, with inflation falling, in real terms it is at its highest rate in over two and a half years."

Ashley Webb, UK economist at Capital Economics, said: "While the easing in wage growth in May was broadly in line with what the consensus and the Bank of England expected, it probably doesn’t offset the overshoot in services inflation in recent months.

"As a result, we have changed our forecast for the timing of the first interest rate cut from 5.25% from August to September, although it is a close call."

Looking ahead to the rest of the day, attention will turn to the latest policy announcement from the ECB at 1315 BST amid expectations it will stand pat on interest rates.

Patrick Munnelly at TickMill Group said: "Traders will closely watch for any comments from officials that may provide insight into future rate cuts. These comments are likely to influence the euro, which reached a four-month high on Wednesday as traders fully priced in a 25 basis-point rate cut by the Federal Reserve in September, following remarks from officials."

In equity markets, Frasers Group surged to the top of the FTSE 100 as it posted annual profits at the top of guidance, despite a dip in revenues. Adjusted pre-tax profits were boosted by a lack of exceptional items compared to the previous year, and came in at £544.8, a 13% uplift and at the top end of guidance of between £500m and £550m.

Schroders followed close behind after an upgrade to ‘overweight’ by Morgan Stanley.

Private equity and infrastructure investment group 3i gained after saying it had an "encouraging start" to the new financial year, with net asset value (NAV) rising 4% over the first quarter.

Anglo American was also in the black as it held annual copper and iron ore production guidance after a second-quarter update.

Dunelm advanced as the homewares retailer said full-year pre-tax profit was set to be "slightly ahead" of current market expectations of £200m after a "strong" final quarter.

AJ Bell gained as the investment platform said assets under administration rose 20% on the year in the third quarter to £83.7bn.

Qinetiq trading higher as it said it was on track to meet FY25 expectations after a "good" first-quarter performance.

On the downside, Diploma fell as the distribution group held guidance as revenue grew 13% in the nine months to 30 June.

Premier Foods slumped even as it reported a jump in first-quarter sales, boosted by strong demand overseas for Mr Kipling cakes.

Market Movers

FTSE 100 (UKX) 8,262.09 0.91%
FTSE 250 (MCX) 21,151.76 0.28%
techMARK (TASX) 4,820.98 0.43%

FTSE 100 - Risers

Frasers Group (FRAS) 892.50p 8.64%
Schroders (SDR) 399.00p 5.89%
3i Group (III) 3,171.00p 3.36%
Anglo American (AAL) 2,321.00p 2.02%
BP (BP.) 461.10p 1.86%
Rightmove (RMV) 589.80p 1.83%
JD Sports Fashion (JD.) 118.75p 1.80%
Haleon (HLN) 340.30p 1.70%
WPP (WPP) 737.60p 1.54%
Severn Trent (SVT) 2,557.00p 1.47%

FTSE 100 - Fallers

Diploma (DPLM) 4,178.00p -2.29%
Smurfit Westrock (DI) (SWR) 3,662.00p -1.88%
Flutter Entertainment (DI) (FLTR) 15,615.00p -1.36%
InterContinental Hotels Group (IHG) 8,288.00p -1.24%
easyJet (EZJ) 482.80p -0.78%
Entain (ENT) 659.80p -0.63%
Intermediate Capital Group (ICG) 2,096.00p -0.47%
International Consolidated Airlines Group SA (CDI) (IAG) 173.60p -0.23%
Marks & Spencer Group (MKS) 307.70p -0.16%
Fresnillo (FRES) 629.00p -0.16%

FTSE 250 - Risers

Dunelm Group (DNLM) 1,188.00p 7.41%
AJ Bell (AJB) 417.50p 5.16%
Auction Technology Group (ATG) 494.50p 4.00%
QinetiQ Group (QQ.) 479.60p 3.41%
Baltic Classifieds Group (BCG) 279.50p 2.95%
Trustpilot Group (TRST) 208.00p 2.21%
Tate & Lyle (TATE) 646.50p 2.05%
Bridgepoint Group (Reg S) (BPT) 256.40p 1.75%
Indivior (INDV) 845.50p 1.74%
Ashmore Group (ASHM) 179.00p 1.70%

FTSE 250 - Fallers

Premier Foods (PFD) 166.60p -2.80%
Babcock International Group (BAB) 503.50p -2.71%
Ninety One (N91) 170.80p -2.62%
TP Icap Group (TCAP) 210.50p -2.09%
C&C Group (CDI) (CCR) 157.80p -1.99%
Bytes Technology Group (BYIT) 485.00p -1.98%
Bakkavor Group (BAKK) 150.50p -1.95%
Grafton Group Ut (CDI) (GFTU) 995.40p -1.93%
FirstGroup (FGP) 172.10p -1.88%
Cranswick (CWK) 4,520.00p -1.74%