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London open: FTSE gains as Brits head to the polls
London stocks rose in early trade on Thursday as Brits headed to the polls amid expectations the Labour party will be voted into power for the first time in 14 years.
At 0820 BST, the FTSE 100 was up 0.4% at 8,206.88.
Derren Nathan, head of equity research at Hargreaves Lansdown, said: “The FTSE 100 has followed the rally in other overseas markets opening up 0.45% to over 8,200, as the UK braces for the electorate’s decision.
“The ballot boxes close at 10pm this evening. Opinion polls are suggesting one of the biggest landslides the nation has ever seen for Labour, but they have been wrong before.
“In a shortened trading session ahead of today’s 4 July celebrations, investors have been digesting weak jobs data in the US. Private payroll growth came in at 150,000 for June, below analyst forecasts. And weekly jobless claims continued their upwards journey for the ninth week in a row. All eyes will now be on tomorrow’s non-farm payroll numbers.”
Still to come on the UK macroeconomic front, the S&P Global CIPS construction PMI for June is at 0930 BST.
In equity markets, Smith & Nephew surged to the top of the FTSE 100 after activist investor Cevian Capital bought a 5% stake in the medical equipment manufacturer. Cevian now holds 43.9m shares in the company, making it the third largest shareholder.
Precision instrument maker Spectris gained as it announced the acquisition of US-based SciAps for up to $260m (£205m). Based in Boston, Massachusetts, SciAps is a specialist provider of handheld instruments for materials analysis.
Great Portland Estates was also in the black as it reported robust leasing activity in the quarter ended 30 June.
In broker note action, Bunzl was boosted by an upgrade to ‘buy’ at HSBC, while Ibstock was trading higher after RBC Capital Markets initiated coverage of the shares at ‘outperform’.
On the downside, polymer maker Victrex slumped as it reported volume and revenue growth for the third quarter but cautioned over difficult trading at its medical segment.
Retailer Next was also in the red as it traded without entitlement to the dividend.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Smith & Nephew Plc | +7.23% | +71.30 | 1,057.50 |
| 2 |  |
Melrose Industries Plc | +3.65% | +20.40 | 579.20 |
| 3 |  |
Bunzl Plc | +2.44% | +74.00 | 3,106.00 |
| 4 |  |
Wpp Plc | +2.11% | +15.40 | 745.60 |
| 5 |  |
Hiscox Ltd | +1.81% | +20.00 | 1,125.00 |
| 6 |  |
Ocado Group Plc | +1.70% | +5.10 | 305.70 |
| 7 |  |
Johnson Matthey Plc | +1.60% | +26.00 | 1,651.00 |
| 8 |  |
Standard Chartered Plc | +1.47% | +10.60 | 733.20 |
| 9 |  |
Kingfisher Plc | +1.46% | +3.70 | 256.50 |
| 10 |  |
St. James’s Place Plc | +1.43% | +8.00 | 565.50 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Next Plc | -1.95% | -178.00 | 8,934.00 |
| 2 |  |
Severn Trent Plc | -0.54% | -13.00 | 2,395.00 |
| 3 |  |
United Utilities Group Plc | -0.51% | -5.00 | 979.80 |
| 4 |  |
Itv Plc | -0.48% | -0.40 | 82.65 |
| 5 |  |
Easyjet Plc | -0.37% | -1.70 | 461.20 |
| 6 |  |
Auto Trader Group Plc | -0.35% | -2.80 | 799.60 |
| 7 |  |
National Grid Plc | -0.13% | -1.20 | 911.00 |
| 8 |  |
Mondi Plc | -0.10% | -1.50 | 1,541.00 |
| 9 |  |
Croda International Plc | -0.07% | -3.00 | 4,087.00 |
| 10 |  |
Shell Plc | -0.00% | -0.00 | 1,894.60 |
US close: Stocks finish shortened session with gains after poor data
US stocks finished mostly higher after a shortened trading session with the S&P 500 and Nasdaq both hitting yet more record highs following a flurry of weak economic data which raised hopes that the Federal Reserve may start loosening monetary policy in September.
The Dow closed just 0.06% lower, but the S&P 500 rose 0.51% to a new high of 5,537.02 and the Nasdaq gained 0.88% to 18,188.30. The New York Stock Exchange closed at 1300 EDT and will remain closed on Thursday for Independence Day.
Investors were focusing on a continued increase in jobless claims and lower-than-expected private-sector payrolls on Wednesday.
“Overall, there is a growing body of evidence that the US economic data is turning lower and could point towards a potential recession later this year,” said Kathleen Brooks, research director for XTB.
“It also puts the spotlight firmly on the September Fed meeting, when the market seems to think that the Fed could cut rates.”
Economic data misses the mark
Private sector employment in the US rose less than expected in June, according to figures released on Wednesday by ADP. Employment increased by 150,000 from May, versus expectations for a 165,000 jump. May’s gain was revised to 157,000 from 152,000.
The Institute for Supply Management’s service-sector purchasing managers’ index fell from 53.8 for May to 48.8 in June, well below the 52.5 expected by the market.
Jobless claims rose 4,000 last week to 238,000 from the previous week’s upwardly revised level of 234,000, remaining near the ten-month high of 243,000 earlier in June, according to the Labor Department.
Mortgage applications fell 2.6% in the week ended 28 June, according to the Mortgage Bankers Association of America.
Job cuts fell 23.6% in June to 48,786, but remained 19.8% higher than June 2023, according to Challenger Gray & Christmas. It was the highest tally for a June since 2020.
America’s trade deficit in goods widened to $100.62bn in May, according to the Census Bureau, the largest reading in two years and following a downwardly revised print of $97.95bn in the previous month.
Market movers
Paramount Global jumped 7% on the back of reports that Skydance Media has struck a preliminary agreement to snap up controlling shareholder National Amusements.
Amazon.com finished lower on the back of a recent filing that revealed founder and executive chair Jeff Bezos intends to sell $5bn of shares this year.
Quest Diagnostics rose strongly after agreeing to buy LifeLabs, a Canadian provider of community laboratory tests, for about $985m including debt.
Thursday newspaper round-up: Post Office, Amazon, UK stocks
The former chair of the Post Office has expressed “sincere regret” for the state-owned body’s failings in the Horizon IT scandal and said it was a mistake not to show a key report on the problem to its board. Tim Parker, who was chair of the Post Office between 2015 and 2022, told a judge-led public inquiry that he felt “deep sympathy” for the Post Office operatives affected by what MPs have described as one of the biggest miscarriages of justice in UK history. – Guardian
Amazon founder and executive chair Jeff Bezos is planning to sell almost $5bn worth of shares in the e-commerce giant, a regulatory filing showed, after its stock hit a record high. The proposed sale of 25m shares was disclosed in a notice filed after market hours on Tuesday. The stock had hit an all-time high of $200.43 during the session. It has jumped more than 30% so far this year, outpacing the 4% gain in the Dow Jones Industrial Average index. – Guardian
Sir Jim Ratcliffe has shelved plans for his Ineos Automotive business to build an electric vehicle only months after a model was unveiled, citing low consumer demand and a lack of clarity over the government’s policy on net zero. In February, the petrochemicals tycoon revealed an all-electric Fusilier, intended to be available also as a hybrid variant and as a smaller sister vehicle to the Ineos Grenadier, an all-terrain 4×4 developed after Jaguar Land Rover’s decision to abandon its old-style Land Rover Defender. – The Times
The Conservatives “damaged” the life sciences sector after more than a decade in government and the country’s biggest pharmaceuticals company was right to question Britain as an investment destination, according to a former minister. The candid remarks were made by George Freeman when he was minister at the Department for Science, Innovation and Technology. They were contained in an email sent from his personal Gmail address to AstraZeneca, Britain’s most valuable public company, and were obtained by The Times under the Freedom of Information Act. – The Times
British stocks are benefitting from political turbulence in France, a City investor has said. In recent weeks there has been a flood of investment into UK markets, with funds seeking stability amid the chaos of Emmanuel Macron’s snap election. Isabel Albarran, investment officer at Close Brothers Asset Management, said there has been a sharp rise in demand for UK assets, which are increasingly being viewed as a safe haven. – Telegraph
