The FTSE 100 fell to a weekly low when it opened, although new employment numbers showed a steady recovery in the UK economy.
The main market lost 0.3% in early trading before rebounding, falling 0.12%, or 8 points, to 7,147, despite the Office of National Statistics (ONS) robust employment numbers showing job vacancies are so high like since records began 20 years ago.
The number of vacancies reached 953,000 from May to July, a huge increase from the 290,000 in April to June and 168,000 more than pre-pandemic levels from January to March 2020. Three-month average earnings through June also rose 8.8% , compared to 7.4% in the previous month.
“The UK employment numbers were a little better than expected and certainly did not contain anything to worry the market. US retail sales will likely come into focus later, ”said AJ Bell analyst Russ Mold.
“Investors will look for signs of cracks in the US recovery in retail numbers, but they will also see signs of mounting inflationary pressures.”
The tick-down in the blue chips was also in spite of it BHP (BHP) rose 7.8%, or 178 pence, to £ 24.60 after the world’s greatest miner revealed plans to move from fossil fuels to “forward-looking” commodities with the sale of his petroleum business.
Markets.com analyst Neil Wilson said BHP “benefited from a global commodity boom and economic recovery.”
The biggest loser was the owner of B&Q and Screwfix kingfisher (KGF), which slipped 2.5%, or 9 pence, to 355 pence. Hotel chains InterContinental Hotel Group (IHG) and White bread (WTB), owned by Premier Inn, both fell 1.8% to £ 45.01 and £ 30.42, respectively. The travel and vacation industry is under renewed pressure as rumor has it that two Covid-19 vaccines no longer mean a traveler is considered fully vaccinated and a booster vaccination is required.
The FTSE 250 fell 0.27%, or 64 points, to 23,647, led by Port energy (HBR), the independent oil and gas explorer formerly known as Premier Oil, which fell 3.8% or 13p to trade at 327p.
The losses in the midcaps were slowed down somewhat Plus500 (PLUS), which climbed 4.6% or 66 pence to £ 14.95 as contracts for the difference trading platform raised its forecast for the year.
“The Plus500 trading platform helped dispel fears that its lockdown-related success could jerk to a halt by increasing its full-year revenue forecast alongside first-half results,” said Mold.
Half-year earnings have declined compared to the strong results when the pandemic volatility was highest and “the market is giving the company the benefit of the doubt for now, but that may change if the momentum falters,” said Mold .
In the mutual fund news, Electra Private Equity (ELTA) was up 1.8% to trade at 595p after it was confirmed that it will be renamed Unbound Group after a split of its hospitality brands, which will be listed under a new company called Hostmore. Winterflood said the spin-off from Hostmore “marks the penultimate phase of a strategy that has returned over £ 2 billion to shareholders since 2016”.
River stone energy (RSE) added 1.5% to change hands at 392p after it announced it would acquire a stake in one of Samsung Ventures’ battery technology portfolios for $ 30 million. The portfolio includes seven unrealized investments, with the majority of the value comes from 1.66 million shares in the electric vehicle battery maker Solid Power. Winterflood said the investment “increases the fund’s exposure to the global energy transition.”
FTSE struggles for profits despite strong employment