London midday: FTSE extends losses after UK jobs data; US NFP eyed

(Sharecast News) - London stocks had extended losses by midday on Tuesday as the latest UK jobs data underpinned rate cut expectations and as investors eyed the long-awaited release of US non-farm payrolls reports for October and November.

The FTSE 100 was 0.4% lower at 9,712.99.

Data released earlier by the Office for National Statistics showed the unemployment rate ticked higher in October, in line with expectations.

The estimated UK unemployment rate rose 0.4 percentage points to 5.1%. The inactivity rate dipped 0.1 percentage points to 21%. Wages also continued to grow. Including bonuses, total earnings rose 4.7%, while regular earnings - which exclude bonuses - rose 4.6%.

Both were above consensus, for growth of 4.4% and 4.5%, but down on September's upwardly-revised growth of 4.9% and 4.7% respectively.

The biggest hike in wages was seen in the public sector, where average regular earnings growth was 7.6%, compared to 3.9% in the private sector.

Liz McKeown, director of economic statistics at the ONS, said: "The overall picture continues to be a weakening labour market.

"The number of employees on payroll has fallen again, reflecting subdued hiring activity, while firms told us there were fewer jobs in the latest period."

Looking ahead to the rest of the day, the non-farm payrolls reports for October and November - which were delayed due to the US government shutdown - will be released at 1330 GMT. Retail sales data for October is due at the same time.

Russ Mould, investment director at AJ Bell, said: "Having moved within sight of the 10,000 mark a little over a month ago, the FTSE 100 lost momentum again today.

"There appears to be little sign of a Santa Rally as concerns about tech valuations continue to knock sentiment in US and Asian markets.

"The chances of an interest rate cut from the Bank of England this Thursday, already widely priced in by the market, looked to have ticked higher off the back of an increase in the UK unemployment rate.

"This was enough to give a small boost to the housebuilding sector, for whom lower rates help improve mortgage affordability and thereby demand for its homes."

Mould said the delayed US jobs data "may offer a window into how the Federal Reserve might manage rates in 2026".

In equity markets, defence stocks were under the cosh, with BAE Systems, Babcock and Rolls-Royce all lower after US President Donald Trump said a Ukraine peace deal was "closer than ever" following talks in Berlin.

Engine maker Rolls-Royce was also in focus after it announced plans for a further �200m "interim" share buyback programme.

Centrica edged lower after its subsidiary Spirit Energy agreed to sell its remaining North Sea oil and gas assets to Serica Energy in a �57m deal.

On the upside, housebuilders Berkeley and Barratt Redrow were lifted by rate cut hopes.

IG Group surged as it extended its share buyback and said it was confident of achieving its medium-term revenue growth targets ahead of schedule.

Recruiter SThree also rose after saying it finished its financial year ended 30 November positively, with improving trends in new placements, and reiterated its earnings forecast.

Market Movers

FTSE 100 (UKX) 9,712.99 -0.39%

FTSE 250 (MCX) 22,062.66 0.06%

techMARK (TASX) 5,552.11 -0.52%

FTSE 100 - Risers

Convatec Group (CTEC) 235.00p 2.17%

JD Sports Fashion (JD.) 82.78p 2.15%

easyJet (EZJ) 505.80p 1.79%

Croda International (CRDA) 2,781.00p 1.76%

Whitbread (WTB) 2,436.00p 1.50%

Smurfit Westrock (DI) (SWR) 2,810.00p 1.22%

Intertek Group (ITRK) 4,540.00p 1.11%

Hiscox Limited (DI) (HSX) 1,404.00p 1.08%

Fresnillo (FRES) 2,884.00p 0.98%

Legal & General Group (LGEN) 251.60p 0.92%

FTSE 100 - Fallers

Babcock International Group (BAB) 1,192.00p -5.32%

BAE Systems (BA.) 1,653.00p -2.39%

Airtel Africa (AAF) 313.00p -1.94%

Burberry Group (BRBY) 1,286.00p -1.83%

Rightmove (RMV) 518.20p -1.71%

Shell (SHEL) 2,656.50p -1.56%

BP (BP.) 430.95p -1.49%

Rolls-Royce Holdings (RR.) 1,098.50p -1.39%

Auto Trader Group (AUTO) 612.60p -1.35%

Melrose Industries (MRO) 553.20p -1.28%

FTSE 250 - Risers

IG Group Holdings (IGG) 1,239.00p 6.26%

Wizz Air Holdings (WIZZ) 1,272.00p 3.50%

B&M European Value Retail S.A. (DI) (BME) 169.30p 3.42%

W.A.G Payment Solutions (EWG) 100.00p 2.88%

SSP Group (SSPG) 190.10p 2.42%

Greggs (GRG) 1,702.00p 2.41%

RHI Magnesita N.V. (DI) (RHIM) 2,675.00p 1.90%

Travis Perkins (TPK) 620.00p 1.81%

Endeavour Mining (EDV) 3,666.00p 1.78%

Drax Group (DRX) 816.00p 1.62%

FTSE 250 - Fallers

Ceres Power Holdings (CWR) 247.00p -7.21%

PPHE Hotel Group Ltd (PPH) 1,700.00p -3.41%

Diversified Energy Company (DI) (DEC) 1,025.00p -2.38%

Allianz Technology Trust (ATT) 514.00p -2.28%

Fidelity China Special Situations (FCSS) 301.00p -2.11%

Energean (ENOG) 864.00p -1.99%

Polar Capital Technology Trust (PCT) 452.50p -1.95%

RTW Biotech Opportunities Ltd (RTW) 2.02p -1.94%

Chemring Group (CHG) 473.00p -1.87%

Avon Technologies (AVON) 1,788.00p -1.87%