- US services and labour figures lift stocks
- Mixed economic data in China, UK and Europe
- FTSE 100 finishes up 0.3 per cent
The UK benchmark finished with mild gains on Wednesday afternoon after some better-than-expected data from the US managed to brighten the mood, which was dampened earlier by gloomy figures from China, Europe and the UK.
In the US, ADP non-farm payrolls increased by 162,000 following a revised 189,000 rise in August (previously 201,000). The consensus estimate as for a gain of 140,000. Meanwhile, the ISM non-manufacturing purchasing managers' index (PMI) rose from 53.7 to 55.1 and ahead of the 53.4 forecast.
"The outcome of Friday's jobs numbers is likely to dictate sentiment near-term. Importantly, the decent ADP figure today has presented more downside risk by way of renewed positive expectations should non-farm disappoint," said financial trader David White from Spreadex.
Non-manufacturing PMIs in both China and the UK fell by more than expected in September, while Chinese consumer sentiment dropped to its lowest level since December. Meanwhile, the Markit Eurozone PMI composite output index (which reflects a weighted-average combination of the manufacturing and services sector in the region) hit a four-month low, though it was slightly ahead of estimates.
Spanish Prime Minister Mariano Rajoy yesterday denied claims that his country is looking to request a bailout this weekend. He said that the country had no immediate plans to ask for aid, but analysts such as Craig Erlam from Alpari say that a bailout is a "foregone conclusion".
In other news today, crude futures fell by as much as 3.5% after the US Energy Department revealed that oil production jumped to 6.52m last week, a 15-year high, while fuel consumption fell.
FTSE 100: Sainsbury and Tesco head opposite ways
After an earlier fall, retailing giant Sainsbury was higher the afternoon after saying it had outperformed the market in the second quarter, with total sales up 4.4% excluding fuel and like-for-like (LFL) sales up 1.9%.
However, sector peer Tesco was still in the red after its interim results. The supermarket colossus said that pre-tax profits (pre exceptionals and property profits) fell 15%, worse-than-expected according to Seymour Pierce, which labelled them as "disappointing" this morning. The company saw a return to LFL sales growth in the second quarter, although it has had to sacrifice margin to do so.
International Airlines Group (IAG) was flying higher after saying that September traffic figures had been boosted by heavy promotional activity by British Airways during and after the Olympic Games.
Pearson, the education and publishing firm, dropped after revealing that its Chief Executive Officer Marjorie Scardino has decided to call it quits at the end of the year.
Asset manager Schroders was unwanted after UBS cut its rating on the stock from 'neutral' to 'sell'. "We believe that expectations on flows and on capital returns have led the stock to re-rate vs peers while we remain cautious on both points," the broker said.
Capita, the outsourcing group, fell after it said it is aware that the Home Office is pursuing discussions with another supplier with the intention of awarding them a contract to support the new Disclosure and Barring Service (DBS) operations, which are part of the coalition's agreement to review and reform the criminal records system.
Anglo American fell after its platinum division, Amplats, saw wildcat strikes spread to its Union Mine in Limpopo Province, to the northwest of Rustenburg.
Heading the other way was mining group Xstrata after raising its copper mineral resource estimate at the major long-life development El Pachón project in San Juan Province, Argentina, by 20%. UBS upgraded the stock, along with potential merger partner Glencore, from 'neutral' to 'buy' today, saying that the deal is "highly likely to go through".
Meanwhile, Centrica was gaining after Citigroup raised its recommendation to 'buy' and lifted its target price from 315p to 360p. Analyst Robert Coates said: "This current valuation in our opinion does not reflect the defensive profile of the stock or the potential upside from deploying the increasing free cash flow."
FTSE 250 movers: FirstGroup plunges after DfT decision
Shares in transport firm FirstGroup took a hammering today after the Department for Transport (DfT) dropped the competition to award it the West Coast franchise. Following a legal challenge from current operator Virgin Rail, the DfT said it had found "significant technical flaws in the way the franchise process was conducted" and was launching a review.
Stagecoach, part owner of the Virgin Rail joint venture with Virgin Group, was in demand after saying it was in discussions with the government regarding the rail franchising review.
BTG, the specialist healthcare company, jumped after reporting it had outperformed in the first half and was boosting its revenue expectations for the full year.
Budget airline easyJet was in demand after a surge in business at the end of the summer and a benign operating environment means it was upping its full-year profit forecasts.
FTSE 100 - Risers
International Consolidated Airlines Group SA (CDI) (IAG) 163.70p +2.96%
ARM Holdings (ARM) 589.00p +2.08%
Centrica (CNA) 334.00p +1.89%
Vedanta Resources (VED) 1,061.00p +1.82%
SSE (SSE) 1,416.00p +1.80%
Carnival (CCL) 2,313.00p +1.80%
Sainsbury (J) (SBRY) 352.50p +1.64%
Hargreaves Lansdown (HL.) 644.50p +1.34%
Eurasian Natural Resources Corp. (ENRC) 316.30p +1.28%
HSBC Holdings (HSBA) 587.70p +1.24%
FTSE 100 - Fallers
Anglo American (AAL) 1,818.00p -3.04%
Tesco (TSCO) 327.95p -2.60%
Weir Group (WEIR) 1,762.00p -2.00%
Capita (CPI) 763.00p -1.61%
Croda International (CRDA) 2,409.00p -1.55%
Tullow Oil (TLW) 1,396.00p -0.99%
Johnson Matthey (JMAT) 2,417.00p -0.98%
Severn Trent (SVT) 1,665.00p -0.95%
IMI (IMI) 940.50p -0.95%
Admiral Group (ADM) 1,054.00p -0.94%
FTSE 250 - Risers
BTG (BTG) 363.20p +9.04%
Dunelm Group (DNLM) 680.00p +3.82%
easyJet (EZJ) 615.00p +3.54%
NMC Health (NMC) 194.70p +3.51%
Home Retail Group (HOME) 92.95p +3.16%
Domino Printing Sciences (DNO) 569.50p +2.98%
Yule Catto & Co (YULC) 172.90p +2.73%
London Stock Exchange Group (LSE) 980.00p +2.46%
TUI Travel (TT.) 241.00p +2.25%
Centamin (DI) (CEY) 96.00p +2.13%
FTSE 250 - Fallers
FirstGroup (FGP) 193.40p -20.74%
Ruspetro (RPO) 101.50p -5.58%
PayPoint (PAY) 741.00p -3.77%
Morgan Crucible Co (MGCR) 271.50p -3.35%
Lonmin (LMI) 537.00p -3.33%
Pace (PIC) 166.80p -2.91%
Inmarsat (ISAT) 570.00p -2.56%
Spirent Communications (SPT) 150.60p -2.40%
Smith (DS) (SMDS) 186.80p -2.35%
Diploma (DPLM) 465.00p -2.31%