London open: Stocks gain as investors mull China GDP, UK jobs data
London stocks rose in early trade on Tuesday, underpinned by solid updates from the likes of Entain and easyJet, as investors mulled the latest UK jobs data and better-than-expected Chinese GDP figures.
At 0905 BST, the FTSE 100 was up 0.3% at 7,899.69.
Data out earlier showed that headline GDP growth in China rose to 4.5% in the first quarter from 2.9% in the final quarter of last year, beating expectations for 4% growth.
Capital Economics said: "This partly reflects a weak base for comparison - virus disruptions were spreading at the end of Q1 last year. But growth also jumped in seasonally-adjusted q/q terms, from an upwardly revised 0.6% in Q4 to 2.2% in Q1. This leaves output 6.8% higher than during the recent trough in Q2 2022. As such, headline GDP growth is on course to exceed 7.0% this quarter."
On home shores, data from the Office for National Statistics showed the unemployment rate ticked higher in the three months to February.
The unemployment rate nudged 0.1 percentage points higher to 3.8%. This was driven by people unemployed for up to six months, the ONS said. Analysts had been expecting the rate to be steady.
Meanwhile, the employment rate came in at 75.8%, up 0.2 percentage points on the previous three-month period. The ONS put this down to part-time employees and self-employed workers.
The data also showed that the number of vacancies fell by 47,000 on the quarter to 1,105,000. This was the ninth consecutive decline and reflects "uncertainty across industries, as survey respondents continue to cite economic pressures as a factor in holding back on recruitment," he ONS said.
The ONS said growth in regular pay excluding bonuses was 6.6% in December to February, while growth in total pay including bonuses was 5.9%. In real terms, however, regular pay fell by 2.3% and total pay was 3% lower.
In equity markets, miners were on the front foot after the Chinese data, with Glencore, Anglo American and Antofagasta all racking up strong gains.
Entain rallied after the Ladbrokes owner hailed a "strong" start to 2023, as it posted a 15% jump in first-quarter net gaming revenue amid record levels of active customers.
Mitie surged after the outsourcing specialist said it expected operating profit to beat guidance after replacing all its Covid-related contract revenue, and announced a £50m share buyback.
Low-cost airline easyJet flew higher after saying it expects to beat market expectations for annual profits due to high demand and strong summer bookings after slashing losses in the first six months of the current year. The company said its headline pre-tax loss was now expected to be £405 - £425m despite challenges from higher fuel prices and inflation. It forecast summer bookings to return to pre-Covid pandemic levels after ramping up crew numbers.
Transact owner IntegraFin was also trading up after well-received second-quarter results.
On the downside, housebuilders Persimmon, Taylor Wimpey and Berkeley fell on the back of a cautious research note by JPMorgan.