• FTSE 100 finishes up 10 points
  • But US indices are in the red
  • Ashtead boosted by results

5.05pm: FTSE closes ahead

FTSE 100 index held on for a positive finish on Thursday, while US stocks were in the red, as investors mulled over the latest economic data.

Footsie finished nearly 11 points, or 0.16%, to the good, at 7,027.

FTSE 250 was also ahead, adding around 200 points, or 0.85%, to close at 23,632.

On Wall Street, the Dow Jones shed 197 points, the S&P 500 lost 27 and the Nasdaq dropped over 82 points.

“It continues to be a seesaw week for stock markets, with US markets taking a downward move after Wednesday’s bounce while European stock indices manage to hold on to their gains for the day,” said Chris Beauchamp, chief market analyst at online trading firm IG, in a note.

“US retail sales provided a point of light in an otherwise dull session, rising 1.8% after last month’s 1% drop, relieving fears that the world’s most important economy was seeing a sustained slowdown in consumer spending,” he noted.

3.50pm: UK blue chips come off their best levels

Leading shares have lost some of their gains as Wall Street heads south after a mixed start.

With conflicting US economic signals – better than expected retail sales and Philadelphia manufacturing survey but slightly higher than expected jobless claims – investors have been struggling to weigh up the impact.

Concerns over a slowdown in China and uncertainty over the fate of its struggling property developer Evergrande have helped dampen sentiment.

Rising energy prices are also a worry, given they will mean increased costs for businesses.

Heading towards the close the FTSE 100 is up 21.32 points or 0.30% at 7037.81 after earlier climbing as high as 7058.

The Dow Jones Industrial Average meanwhile is down 178.04 points or 0.51%. The S&P 500 has lost 0.62% and the Nasdaq Composite has fallen 0.55%.

Another bit of fallout from China was a drop in metal prices after news it planned to release some of its reserves to boost supply.

So miners are dominating the fallers in the UK blue chip index. Anglo American PLC (LSE:AAL) is down 4.52%, precious metals group Fresnillo PLC (LSE:FRES) has fallen 3.26%, Rio Tinto PLC (LSE:RIO) is down 2.76%, BHP PLC has lost 2.68% and Antofagasta PLC (LSE:ANTO) is off 2.25%.

Still heading higher though is plant hire group Ashtead PLC, up 5.23% after well received results.

Rolls-Royce has risen 3.79% after it was mentioned in the agreement forming a trilateral security partnership between the US, UK and Australia called Aukus which will in part build new nuclear powered submarines.

3.02pm: Ryanair update lifts airline shares

A positive update from Ryanair Holdings PLC (LSE:RYA) has given a lift to the whole airline sector, which has been under cosh again in recent days on worries about the prospects for international travel.

Ryanair said it planned to fly an extra 25mln passengers by 2026 – up from its previous target of 200mln – as the industry tries to rebound from the pandemic.

UBS analysts said: “The company now plans to increase passengers by 50% from March 2020 levels of 149mln passenger (to 225mn) by March 2026.

“Previous guidance was around 200mln passengers and we currently forecast 203mln passengers.

“Should the profitability per passenger be maintained then we expect upward pressure to forecasts. Indeed a c11% upgrade to passenger numbers versus our passenger forecasts for 2026 at similar levels of profitability would all else being equal also increase our net income from around EUR2.3bn to around EUR2.5bn. There is the potential for improved profitability per passenger given the gearing.”

The news has pushed Ryanair’s shares up 7.55% to EUR16.52, while British Airways owner International Consolidated Airlines PLC has climbed by 3.27% and EasyJet PLC has improved by 6.36%. Wizz Air Holdings (AIM:WIZZ) PLC has also benefited, adding 4.62%.

2.47pm: US markets uncertain after latest data

Wall Street has made a mixed start to trading, as investors pored over the latest set of economic data.

The better than expected retail sales and Philadelphia manufacturing survey has helped push the Dow Jones Industrial Average 52.2 points or 0.15% higher to 34,866.59.

But the more broadly based S&P 500 is down 0.12% and the tech-heavy Nasdaq Composite is 0.36% lower.

Back in the UK, the FTSE 100 remains in positive territory, up 36.63 points or 0.51% at 7050.57.

2.25pm: Philly Fed manufacturing survey jumps sharply

As well as the retail sales and jobless claims, the latest manufacturing survey from the Philadephia Federal Reserve came in much stronger than expected.

The index jumped from 19.4 to 30.7, much better than the forecast dip to 18.8.

Investors now have to weigh up what this all for the Federal Reserve and whether or not it will start to taper its support for the economy.

Craig Erlam, senior market analyst at OANDA said: “Today’s data from the US has done little to clear things up, with both retail sales and the Philly Fed manufacturing index smashing expectations while jobless claims popped a little but only just exceeded forecasts. Retail sales have been volatile for a number of months but an August increase of 0.7% was the reverse of the decline that was expected.

“Philly Fed has been trending lower since March and that trend was expected to continue but a surprise jump may be cause for optimism. While new orders and employment indicators softened, firms remain optimistic about the next 6 months as current general activity and shipments saw large increases.”

1.41pm: Stronger than expected US retail sales

US retail sales have come in stronger than expected in August.

They rose by 0.7% compared with expectations of a 0.7% fall. However the July figure was revised from a 1.1% fall to a 1.8% decline.

Sales at clothing stores were up 38.8% while gasoline sales rose 35.7%. But there was another sharp drop in car sales.

Elsewhere weekly jobless claims were higher than forecast.

The number of Americans seeking unemployment benefit last week was 332,000, compared to expectations of a figure of 323,000

The previous week’s figure was revised up by 2,000 to 312,000.

After the data, the Dow Jones Industrial Average is now expected to show a miniscule 0.01% fall at the open, with the S&P 500 down 0.13% and the Nasdaq Composite a fall of 0.27%.

Meanwhile the FTSE 100 is up 27.87 points or 0.4% at 7044.36.

12.08pm: Investors await US retail sales and jobless claims

Worries about a Chinese slowdown and the fate of the country’s struggling property group Evergrande are likely to weigh on Wall Street when trading begins.

US markets ended the Wednesday session higher, but the Dow Jones Industrial Average is expected to edge 23 points or 0.1% lower at the open. The S&P 500 is forecast to show a 0.14% decline and the Nasdaq Composite is indicated 0.21% lower.

The day’s economic news includes retail sales, which have been fairly volatile recently.

Michael Hewson at CMC Markets UK said: “While the summer months have seen holiday and theme parks reopen, we’ve also seen the prices of almost everything soar, including used cars, and air fares, while cases of the Delta variant have impacted consumer confidence with sharp drops across the board in August.

“This is particularly disappointing for an economy that relies so much on consumer spending, and which has seen retail sales stall over the last three months. A decline of -1.7% in May, a rise of 0.7% in June and a -1.1% decline in July looks set to be followed by another decline in numbers that are due to be released later today.”

Analysts are forecasting a drop of 0.7% for August.

Meanwhile the weekly jobless claims are expected to edge up from 310,000 to 323,000.

Back in the UK, the FTSE 100 remains steady, up 32.2 points or 0.46% at 7048.69.

11.38am: Labour shortages show no sign of improving

More evidence of staff shortages, especially in the hospitality industry, from the latest data from the Office for National Statistics.

According to the report, 13% of all business said it was harder to fill vacancies than usual, up from 9% in early August. For the hospitality industry that figure was 30%.

Danni Hewson, AJ Bell financial analyst, said: “The labour shortage has been tough for businesses trying to capitalise on post lockdown trade and it doesn’t show any sign of getting better in a hurry, in fact the situation only seems be getting more acute.

“It’s no surprise to see hospitality topping the list of those struggling to recruit. Restrictions meant they were late to the party and many people who used to work in bars and restaurants found other jobs to pay the bills, jobs that often have more sociable hours. There’s also a niggling uncertainty amongst the public that we’ve really seen an end to restrictions and most people believe that any spike in COVID cases would result in hospitality being forced to close once again.

“Anyone who has shopped for groceries recently will have experienced a nasty moment at the till when they’ve realised how much more expensive food is becoming and the HGV driver shortage has been a key factor in those price rises. Almost half of businesses in the transport and storage sector said that a lack of EU workers was to blame for the shortages and across the board one in four businesses said a fall in the number of EU applicants was an issue.

“It’s hard to know how big a part Brexit has played because the waters have been well and truly muddied by the pandemic. It’s also impossible to guess how the end of the furlough scheme will change the picture. Some jobs will be lost, and some workers will be brought back into the labour market where they will be received with open arms if the latest recruitment drive by John Lewis is anything to go by.”

The survey showed that businesses across all industries said that a lack of suitable applicants was the main reason for being unable to fill vacancies in late August 2021, with transport and storage firms the most likely to cite a lack of EU applicants specifically.

11.25am: Marks and Spencer confirms closure of 11 French stores

Marks and Spencer Group PLC (LSE:MKS) shares have fallen 1.63% as the retailer confirmed reports it plans to close 11 of its French stores because of supply problems since Brexit.

The stores, run with partner SFH, will close by the end of the year, with nine sites at travel hubs remaining.

Paul Friston, M&S managing director of international, told the BBC: “M&S has a long history of serving customers in France and this is not a decision we or our partner SFH have taken lightly.

“However, as things stand today, the supply chain complexities in place following the UK’s exit from the European Union now make it near impossible for us to serve fresh and chilled products to customers to the high standards they expect, resulting in an ongoing impact to the performance of our business.

“With no workable alternative for the High Street stores, we have agreed with SFH to close all 11 franchised stores.”

10.26am: Power companies in demand

Rising energy prices as we start heading into winter may be bad news for consumers and industry (the surge in the cost of gas has already caused fertiliser producer CF Industries to halt operations at two UK sites and steel producers have made similar moves).

But it’s an ill wind etc.

Energy companies themselves have seen their share prices boosted by the recent record run in power prices.

Power station operator Drax PLC has risen 7.21% – helped by a positive note from Barclays – while SSE PLC (LSE:SSE) is up 0.85% and National Grid (LSE:NG.) PLC is 0.6% better.

Overall the FTSE 100 is holding on to its gains, up 36.26 points or 0.52% at 7052.75.

Meanwhile the FTSE 250 – where Drax is the leading riser – is up 0.56% at 23,565.09.

9.38am: Evergrande saga adds to China concerns while mining shares drop

Speaking of China, the recent economic data including retail sales suggests a slowdown in the world’s second biggest economy which is causing some worry for investors.

But there are also concerns about a potential collapse of the country’s second largest property developer, Evergrande, which is facing a liquidity crisis.

It has total liabilities of US$300bn and is trying to raise funding to stave off a crisis.

The latest development saw its onshore unit halt trading in all bonds after agencies cut their ratings on its paper.

China is also having an impact on the commodities market, with metal prices falling after the country said it would release more of its reserves to tackle supply shortages.

So mining companies are dominating the FTSE 100 fallers.

Rio Tinto PLC (LSE:RIO) is down 2.17%, Anglo American PLC (LSE:AAL) is off 1.59%, Antofagasta PLC (LSE:ANTO) has fallen 1.09% and BHP PLC has lost 0.93%.

But the biggest faller is Burberry PLC, which has been weak for days on the potential slowdown in Asia, one of its key markets.

Its is now another 2.42% lower.

The FTSE 100 however remains positive, up 32.99 points or 0.47% at 7049.48.

9.23am: Defence companies in the spotlight

Confrontation with China is clearly seen by the market as a good thing for the UK defence industry.

So it is with the announcement that the US, UK and Australian governments are setting up a trilateral security partnership called Aukus which will in part build new nuclear powered submarines.

The UK statement on the deal included the following: “The UK has built and operated world-class nuclear-powered submarines for over 60 years. We will therefore bring deep expertise and experience to the project through, for example, the work carried out by Rolls Royce near Derby and BAE Systems in Barrow.”

As a result, Rolls-Royce PLC shares are leading the FTSE 100 risers, up 3.51% or 3.7p to 109.2p.

BAE Systems PLC (LSE:BA.) is 1.02% better at 554.6p.

Overall the FTSE 100 is holding on to its gains, up 34.22 points or 0.49% at 7050.71.

8.29am: Markets open in the green

Investors in the UK decided to take succour from recent US manufacturing and inflation data that were more benign than expected rather than the unfolding slowdown being experienced in China, the world’s economic growth engine.

As a result, the FTSE 100 opened 31 points to the good at 7,047.46.

“The generally positive opening was led by some strength within cyclical shares, although the moves were unconvincing,” said Richard Hunter, head of markets at Interactive Investor.

“The indices nonetheless remain ahead in the year to date, with the FTSE100 having added 9% and the FTSE250 14.8%.

“Even so, with the known issues now on the table and potentially priced in, the next catalysts could either come from renewed signs of a global economic bounce back, or the third-quarter reporting season providing positive shocks in the first weeks of October.”

The mining stocks were on offer following the latest lacklustre Chinese data with Anglo American, off 1.5%, leading the early fallers. Burberry, which also has big exposure to the country, was an early casualty too.

On the flipside, traders reacted positively to first-quarter results from the US-focused plant hire group Ashtead, whose shares opened 2.5% higher.

6.50 am: FTSE 100 seen a sliver higher

The FTSE 100 is set to start Thursday a sliver higher after US stock indices moved higher, and, this morning Asian markets turned lower.

CFD firm IG Markets sees the FTSE 100 around 2 points higher, making the price 7,030 to 7,033 with just over an hour to go until the open.

US markets were boosted on Wednesday as key regional manufacturing statistics significantly beat expectations, raising sentiments ahead of the American economy’s big-ticket economic release of the week – monthly retail sales data due later today.

“Overall, the week is going to plan thus far. As expected, markets, particularly in the US, are cherry-picking news headlines and tier-2 data to fit the narrative of flip-flopping daily sentiment,” OANDA market analyst Jeffrey Halley said in a note.

“Hopefully, next week’s cast of thousands line-up of central bank policy decisions, staring the Federal Reserve, delivers more thematic clarity. In the meantime, I shall leave my earplugs in to drown the noise and continue to believe in the gospel of buying-the-dip in a central bank-primed, unlimited money at zero per cent world.”

The Dow Jones rose by 236 points, 0.68%, to finish Wednesday at 34,814 whilst the S&P 500 gained more, rising 0.85% to 4,480.

The Nasdaq similarly added 0.8% as it climbed 123 points to a close of 15,161.

Elsewhere the small-cap centric Russell 2,000 index was strongest, stepping up 1.1% to 2,234.

Around the markets

The pound: US$1.3834, down 0.04%

Gold: US$1,790 per ounce, down 0.27%

Silver: US$23.82 per ounce, down 0.45%

Brent crude: US$US$75.65 per barrel, up 2.7%

WTI crude: US$72.76 per barrel, up 3.2%

Bitcoin: US$48,347, up 4.47%

Ethereum: US$3,639, up 7.35%

6.50am: Early Markets – Asia / Australia

Stocks in the Asia-Pacific region were mostly lower on Thursday as Australia’s unemployment rate fell to 4.5% on a seasonally adjusted basis in August, lower than the 4.9% forecast in a Reuters poll.

Australia’s S&P/ASX 200 gained 0.66% by the last hour of trading, with the Australian Bureau of Statistics attributing the decline in unemployment to a large fall in participation during the recent lockdowns rather than strengthening of labour market conditions.

China’s Shanghai Composite slipped 0.67% and Hong Kong’s Hang Seng index slumped 1.81%.

In Japan, the Nikkei 225 dipped 0.69% while South Korea’s Kospi fell 0.53%.



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