London pre-open: Stocks to fall ahead of payrolls

(Sharecast News) - London stocks were set to fall at the open on Friday as investors mulled the conditions attached to a potential reopening of the Strait of Hormuz and eyed the latest US non-farm payrolls report.

The FTSE 100 was called to open around 15 points lower. At 0730 BST, Brent crude was up 0.8% at $83.18 a barrel and West Texas Intermediate was 0.6% higher at $77.74.

Danske Bank said: "A draft Iran-Oman proposal, now under review by the parliament in Iran, would impose stricter conditions on commercial shipping through the strait than markets had anticipated.

"The plan includes limits on US and Israeli vessels, compensation requirements for countries deemed hostile and penalties of 20% of cargo value for violations. Reports that Iran struck what it described as 'hostile targets' in the strait added to the pressure."

Looking ahead to the rest of the day, attention will turn to the non-farm payrolls report for July, along with average earnings and the unemployment rate at 1330 BST.

Market expectations are for payrolls to have increased by 80,000 in July following a 57,000 increase in June, and for the unemployment rate to remain steady at 4.2%.

On home shores, the latest figures from Lloyds showed that house prices were flat in July.

House prices were unchanged on the month, having nudged up 0.2% in June. On the year, prices were just 0.1% firmer in July following 0.7% growth the month before.

The average price of a home stood at �299,253, versus �299,396 in June.

Amanda Bryden, Head of Mortgages at Lloyds, said: "Affordability remains a challenge for many would -be buyers and, following recent events in the Middle East, mortgage rates have edged higher again after easing earlier in the summer.

"Sensitivity to borrowing costs is reflected in the latest industry data, which show a modest increase in both mortgage approvals and completed transactions in June following a bigger dip in May. While housing demand remains broadly steady, activity continues to respond quickly to changes in mortgage rates.

"Looking ahead, we expect market activity and house prices to remain relatively stable over the remainder of the year. Developments will be shaped by both how mortgage rates respond to the outlook for inflation and wider household confidence."

Elsewhere, data from the British Retail Consortium showed that footfall fell in July, albeit less than in June, with high streets still the worst performers as the hot weather continued.

The BRC-Sensormatic footfall monitor showed that total footfall declined 2.1%, an improvement on June's 3.4% slump.

Footfall on the high street fell 3.8% in July, having dropped 6.2% in June, while retail parks saw a 1.2% increase, having fallen 0.3% the month before.

Footfall at shopping centres was down 1.4% last month following a 2.5% fall in June.

Footfall rose 2.7% in Scotland and 2.6% in Northern Ireland. It was flat in Wales and down 3% in England.

BRC chief executive Helen Dickinson said: "The heatwave continued to bear down on retail footfall in July, with high streets worst affected. London was hit particularly hard as soaring temperatures made tube and train travel less attractive, with some commuters and shoppers opting to stay home. Nonetheless, it was still an improvement on the previous month's figures, when record-breaking sunshine saw footfall fall by an even bigger margin.

"Climate change continues to deliver more and more extreme temperatures in the UK. Retailers are responding by investing in both mitigations - such as more air conditioning and more efficient refrigeration units - and in sustainability initiatives aimed at reducing carbon emissions. Unfortunately, business rates often punish stores for such investments, showing the need for government to look again at this broken system."

Corporate news was scarce but JD Sports Fashion said Peter Agnefj�ll has been appointed as chair effective from September 2026. He succeeds Darren Shapland, who has served as interim chair since the end of July and will remain on the board as an independent director.

Agnefj�ll spent almost two decades at IKEA Group, rising to president and CEO between 2013 and 2017 and subsequently served as chair of Ahold Delhaize from 2021 to 2025.

Goodwin confirmed that it has begun a strategic review to consider a range of potential options to maximise value for shareholders which includes the sale of a substantial part of the mechanical engineering division.

Responding to recent press speculation, it said: "Discussions are ongoing and there can be no certainty that a transaction will be entered into."

Rothschild & Co is advising the board on the strategic review.