- All eyes on US jobs data
- Outcome could be a major factor in presidential elections
- Admiral, Meggitt and RBS disappoint
The FTSE 100 was little changed by Friday lunchtime, having trade within a narrow range for most of the morning session, with investors nervous ahead the pivotal employment data due out in the US in the coming hours.
Concensus estimates are for a rise of 125,000 in non-farm payrolls in October, higher than the 114,000 gain the month before. Meanwhile, the jobless rate is expected to tick up to 7.9% from 7.8%.
Market analyst Craig Erlam from Alpari said: "The US jobs report is always the most anticipated economic data release each month, but this month's carries with it even more importance. While the non-farm payrolls figure is the most important release among traders, as it is seen as a much more reliable indicator of employment, the unemployment figure is what tends to write the headlines."
With the presidential elections remaining in a dead heat, the outcome in non-farm payrolls could be a major factor in whether Barack Obama secures another four years as US President, or whether Republican challenger Mitt Romney can secure his place as the premier of the world's largest economy. Election Day is Tuesday.
Erlam said that a surprise move in the jobless rate back above 8% would be "devastating" for the Obama campaign: "To have such negative headlines regarding unemployment splashed all over the newspapers days before the people go to the polls is likely to swing the undecided voter in favour of Mitt Romney. And you can guarantee the Romney campaign would capitalise on the rise in unemployment."
In other news, the UK economy is not expected to contract this year, but ill-timed fiscal consolidation in Europe and other external risks continue to pose risks, the National Institute of Economic and Social Research (NIESR) said in its latest quarterly forecasts.
The British economy is now expected to grow by 0.1% in 2012, which marks a slight upwards revision on its previous forecasts. Next year however the external environment is no longer being forecast to make a contribution to aggregate demand, leading the NIESR to reduce its forecast for gross domestic product (GDP) downwards, to 1.1%, as net trade will not make any positive contribution.
FTSE 100: Admiral, Meggit and RBS disappoint with Q3 results
Car insurance firm Admiral dropped after seeing a 2% decrease in third-quarter turnover. "Little has changed since the half year. The UK car insurance market is cyclical and we are in the softer part of the cycle with premium rates coming down," said Chief Executive Henry Engelhardt.
Aerospace, defence and energy components group Meggitt was unwanted after saying that organic revenues were flat year-on-year and revenue growth will be in the mid-single digits in 2013.
Banking giant RBS was lower after reporting a statutory loss before tax of £1.26bn for the three months to September 30th after taking a £1.46bn charge in own-credit adjustments and a £400m bill for PPI redress. Investec maintained its 'sell' rating for the stock this morning, saying that it had expected a loss of £1.0bn.
Airlines group IAG was among the best performers this morning, up 3% over 168p. Technical analysts at Charles Stanley said: "A close above 168p would suggest that this line is giving way and would amount to a 'trading buy' signal."
Oil giant Tullow was a high riser after JPMorgan Cazenove upgraded its stance on the shares
to 'overweight'. In contrast, engineering giant Weir was under the weather after Jefferies cut its rating to 'hold' and supermarket group Morrisons fell after Morgan Stanley downgraded the stock to 'underweight'.
Shares in luxury brand Burberry were making gains ahead of its first-half results on November 7th. Seymour Pierce has raised its target price and maintained its 'buy' rating this morning, saying that risks to forecasts are now 'on the upside'.
FTSE 250: Bumi rises on appointment of Rothschild Group
Mining group Bumi advanced after saying it has appointed Rothschild Goup as its financial adviser with immediate effect to evaluate the proposal received from Long Haul Holdings.
Hotels group Millennium & Copthorne fell despite seeing RevPAR rise 2.6% in the third quarter, with London enjoying an Olympic boost.
Hikma Pharmaceuticals dropped after saying that it has opted to halt commercial production of generic drugs at Eatontown facility in the US until mid-January while it gets to grips with compliance issues raised by the Food & Drug Administration (FDA).
Electrical retailer Dixons continued to make gains on speculation that its main High Street rival Comet could be going into administration.
FTSE 100 - Risers
International Consolidated Airlines Group SA (CDI) (IAG) 168.50p +3.18%
Aberdeen Asset Management (ADN) 343.50p +2.54%
Tullow Oil (TLW) 1,439.00p +2.27%
Intertek Group (ITRK) 2,903.00p +2.25%
Whitbread (WTB) 2,442.00p +2.09%
GKN (GKN) 216.10p +1.93%
Rio Tinto (RIO) 3,222.50p +1.80%
Hargreaves Lansdown (HL.) 759.00p +1.67%
Capita (CPI) 734.50p +1.66%
ITV (ITV) 89.70p +1.59%
FTSE 100 - Fallers
Admiral Group (ADM) 1,085.00p -4.99%
GlaxoSmithKline (GSK) 1,353.50p -2.45%
Royal Bank of Scotland Group (RBS) 281.40p -2.02%
Morrison (Wm) Supermarkets (MRW) 262.60p -1.83%
Petrofac Ltd. (PFC) 1,594.00p -1.79%
Pennon Group (PNN) 705.50p -1.67%
SSE (SSE) 1,437.00p -1.64%
Vodafone Group (VOD) 167.80p -1.29%
Smith & Nephew (SN.) 641.00p -1.16%
Severn Trent (SVT) 1,578.00p -1.13%
FTSE 250 - Risers
Bumi (BUMI) 277.00p +11.56%
Dixons Retail (DXNS) 25.18p +7.70%
Chemring Group (CHG) 272.80p +4.68%
Homeserve (HSV) 233.30p +4.53%
Brown (N.) Group (BWNG) 354.00p +4.21%
Jupiter Fund Management (JUP) 279.90p +3.86%
Ferrexpo (FXPO) 227.40p +3.46%
Spectris (SXS) 1,820.00p +3.41%
New World Resources A Shares (NWR) 270.80p +3.40%
Perform Group (PER) 407.10p +3.32%
FTSE 250 - Fallers
Centamin (DI) (CEY) 63.50p -5.37%
Millennium & Copthorne Hotels (MLC) 495.00p -3.23%
Hikma Pharmaceuticals (HIK) 730.00p -3.18%
Balfour Beatty (BBY) 313.10p -2.40%
Berendsen (BRSN) 577.50p -1.95%
COLT Group SA (COLT) 107.00p -1.83%
Go-Ahead Group (GOG) 1,304.00p -1.81%
Lancashire Holdings (LRE) 859.50p -1.72%
Carpetright (CPR) 687.00p -1.65%
Synergy Health (SYR) 936.00p -1.63%