FTSE 100 starts its day on the back foot; little in the GDP figures the unsettle the livestock

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  • FTSE 100 down 17 points
  • boohoo to create 5,000 jobs
  • UK GDP adds 4.8% in the second quarter

9.30am: boohoo to create 5,000 jobs


The FTSE 100 held its losses in mid-morning and was down 17 points to 7,202.


Boohoo Group PLC (AIM:BOO) said it wants to hire 5,000 new people to handle its increased diversification and growing demand for its brands, which range from PrettyLittleThing, NastyGal and TopShop for its younger customers to Karen Millen, Dorothy Perkins and Oasis for the grown-ups, as well as newly acquired Debenhams as a digital department store.


The fast-fashion retailer will spend GBP500mln over the next five years to expand warehouse space and improve its technology.


In the first quarter of the year, the AIM-listed giant saw sales jump 32%, some 91% ahead of the same period two years before, despite widespread criticism on how it treats its workers.


Shares were up 1.5% to 269.9p on Thursday morning.


8.30am: FTSE 100 starts its day on the back foot


It was hard to gauge the mood in the City early on with the FTSE 100 kicking off in negative territory when the early predictions had been for a positive start.


There was little to unsettle the livestock in the latest economic data.


Gross domestic product grew by 4.8% between April and June as the economy progressively emerged from lockdown and pubs and restaurants opened.


While the figure was a slither below the 5% predicted by the Bank of England last week, it was in line or even marginally ahead of consensus.


Indeed, the commentary around the latest GDP print was largely upbeat.


“These figures knock fears over the impact of the delta variant on the head. Consumers are continuing to spend, regardless,” said Steve Clayton, a fund manager at Hargreaves Lansdown.


Topping the Footsie leader board early on was Aviva (LON:AV.), which rose 2.3% after announcing plans for to return GBP4bn to shareholders.


The losers were led by Rio Tinto (LON:RIO), down 6.6%, after it began trading without entitlement to a fairly hefty dividend payment.


Dropping down to the mid-caps, Cineworld (LON:CINE) led the field after a better-than-expected performance in its financial fourth quarter, saying it also exploring a potential US listing.


“Cineworld is dependent on blockbuster films enticing customers back to the cinema. It must also pivot to new revenue streams: less Hollywood, more arthouse and alternative content,” said Harry Barnick, analyst at Third Bridge.


6.50 am: Footsie called higher


The FTSE 100 is set to start Thursday’s trading in positive territory following yesterday’s upbeat trading.


CFD firm IG Markets sees the blue-chip benchmark up around 9 points, making the price of 7,193 to 7,196 with just over an hour to go until the open.


Equity markets are being supported by last night’s inflation data in the United States, where core CPI cooled from recent months with the rate of inflation seen slowing from the rampant levels seen in recent months – keeping with Federal Reserve expectations. Today, comes US PPI followed by weekly jobless stats.


In the UK, significantly, will be the second quarter GDP print which will be somewhat instructive in regards to Britain’s ongoing economic recovery coming out of pandemic.


“While there are some who say that today’s numbers are very much rear-view mirror stuff, the GDP numbers will still represent the foundation for the recovery from the Q1 slump and lockdown, and as such is an important base for the levelling off of growth that we can expect to see in Q3 and the rest of the year,” said Michael Hewson, analyst at CMC Markets.


“There will inevitably be bumps along the way when we get to see the Q3 numbers three months from now, with the various supply chain and “pingdemic” disruptions, but how well the economy has rebounded in Q2 will determine how solid the foundations are for the second half of this year.


“It will also offer important clues as to the possible direction of monetary policy over the course of the next few months.”


Last night on Wall Street, the Dow Jones climbed 220 points or 0.6% to close at 35,484 whilst the S&P 500 nudged 0.25% higher to end the session at 4,447.


The Nasdaq meanwhile slipped 0.16% lower to 14,765. Elsewhere, the small-cap Russell 2000 index moved up 0.49% to 2,250.


In Asia, the major indices were in red. Japan’s Nikkei edged just a sliver lower, to trade at 28,046.


Hong Kong’s Hang Seng dropped 0.53% to 26,518 and the Shanghai Composite dipped 0.2% to 3,525.


Around the markets


The pound: US$1.13869, up 0.01%


Gold: US$1,752, down 0.01%


Silver: US$23.46, down 0.32%


Brent crude: US$71.43 up 1.1%


WTI crude: US$69.28, up 1.4%


Bitcoin: US$45,115, down 1.46%


Ethereum: US$3,132, down 1.7%


6.50am: Early Markets – Asia / Australia


Stocks in the Asia-Pacific region were lower on Thursday as South Korea reported a new daily record of more than 2,200 COVID-19 cases on Wednesday.


Melbourne extended its lockdown by another week as Australia struggles to contain the highly infectious delta variant.


The Shanghai Composite in China fell 0.23% and Hong Kong’s Hang Seng index dipped 0.57%


In Japan, the Nikkei 225 dropped 0.12% while South Korea’s Kospi declined 0.48%.


Shares in Australia fell, with the S&P/ASX 200 trading 0.13% lower.


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