London open: Stocks fall amid inflation concerns, ahead of payrolls

At 0855 GMT, the FTSE 100 was down 1.2% at 6,571.43, as yields rose.

Richard Hunter, head of markets at Interactive Investor, said: "Inflation concerns and a continued rotation out of growth stocks is beginning to weigh on equity markets.

"The Federal Reserve’s insistence that it believes these inflation moves are transitory was not enough to arrest a further spike in bond yields, as investors fretted that there were no plans to control the longer end of the yield curve. At the same time, the perceived threat of higher interest rates arriving earlier than expected washed through to the shares which could be most obviously affected by the resultant slowing of profits."

All eyes will be on the payrolls report, which is due out at 1330 GMT, along with the unemployment rate and average earnings.

Hunter said the expectation is for 182,000 to have been added in February from January, while the unemployment rate is seen unchanged at 6.4%.

"This is likely to bring some focus back towards the President’s proposed stimulus package as the economy fails to fire," he said.

In equity markets, London Stock Exchange shares slid even after it posted higher full-year profit and sales driven by a stronger-than-expected showing in both its Post Trade units and Information units despite the "unparalleled" environment.

On the upside, Spirent Communications surged after the technology company said it had bought US peer octoScope for $55m in cash.

ConvaTec rallied as it posted a rise in full-year revenue but a dip in earnings after the pandemic created "both challenges and opportunities" for the medical products and technology company in 2020.

Aggreko was in the black after agreeing to be bought by private equity firms TDR Capital and I Square Capital Advisors in a deal valuing the FTSE 250 company at £2.3bn.

Market Movers

FTSE 100 (UKX) 6,571.43 -1.19%
FTSE 250 (MCX) 21,080.07 -1.02%
techMARK (TASX) 4,034.73 -0.82%

FTSE 100 - Risers

BP (BP.) 313.60p 0.16%
Standard Chartered (STAN) 478.00p 0.15%
RSA Insurance Group (RSA) 677.80p -0.03%
Sage Group (SGE) 596.40p -0.10%
Sainsbury (J) (SBRY) 222.60p -0.13%
HSBC Holdings (HSBA) 425.40p -0.26%
Polymetal International (POLY) 1,450.00p -0.31%
SEGRO (SGRO) 899.80p -0.38%
Morrison (Wm) Supermarkets (MRW) 172.20p -0.40%
Burberry Group (BRBY) 1,842.00p -0.43%

FTSE 100 - Fallers

Scottish Mortgage Inv Trust (SMT) 1,032.00p -5.15%
London Stock Exchange Group (LSEG) 9,080.00p -4.30%
International Consolidated Airlines Group SA (CDI) (IAG) 208.70p -3.47%
Rolls-Royce Holdings (RR.) 111.10p -2.84%
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,388.00p -2.65%
Flutter Entertainment (FLTR) 14,780.00p -2.31%
Berkeley Group Holdings (The) (BKG) 4,221.00p -2.20%
Smith (DS) (SMDS) 398.70p -2.11%
Admiral Group (ADM) 2,999.00p -2.09%
JD Sports Fashion (JD.) 794.20p -2.05%

FTSE 250 - Risers

Spirent Communications (SPT) 245.00p 7.22%
Cairn Energy (CNE) 206.00p 3.00%
Convatec Group (CTEC) 194.30p 2.91%
Wood Group (John) (WG.) 317.40p 2.29%
Energean (ENOG) 919.70p 1.56%
Aggreko (AGK) 899.00p 1.12%
Signature Aviation (SIG) 402.00p 1.01%
WH Smith (SMWH) 1,916.00p 0.79%
FirstGroup (FGP) 90.60p 0.67%
Petrofac Ltd. (PFC) 132.10p 0.65%

FTSE 250 - Fallers

Baillie Gifford US Growth Trust (USA) 287.00p -8.01%
Allianz Technology Trust (ATT) 2,585.00p -7.01%
Edinburgh Worldwide Inv Trust (EWI) 326.00p -5.37%
Virgin Money UK (VMUK) 186.15p -3.65%
Renishaw (RSW) 5,745.00p -3.61%
Polar Capital Technology Trust (PCT) 2,090.00p -3.46%
The Renewables Infrastructure Group Limited (TRIG) 126.00p -3.37%
Aston Martin Lagonda Global Holdings (AML) 1,919.50p -2.98%
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,388.00p -2.65%
PureTech Health (PRTC) 414.50p -2.59%