FTSE 100 watch: Footsie trims gains after weaker-than-expected US jobs report

on Sep 1, 2017

The UK benchmark index has been steady in today’s session, finding support in strong miners, following upbeat data out of China, the world’s top metals consumer. The FTSE 100, however, has pulled away from session highs after the latest US nonfarm payrolls report fell short of expectations.

As of 14:51 BST, Britain’s blue-chip index had added 14.70 points to stand 0.20 percent higher at 7,445.32, having traded about 0.4 percent higher earlier in the session. The Footsie fell to about 0.1 percent after the US Bureau for Labour Statistics reported that the world’s biggest economy had added 156,00 new jobs last month, while the unemployment rate was little changed at 4.4 percent. IG had previously reported that expectations were for 185,000 new jobs, while the unemployment rate was expected to have remained at 4.3 percent.

“August’s nonfarm data is disappointing but should be viewed the context of solid US and global economic growth, strong earnings, low inflation and still-ample global liquidity,” Kully Samra, UK managing director at Charles Schwab, said in a note, as quoted by CNBC, adding that investors would now be looking to the next Federal Reserve meeting for further clarification on the reduction of the central bank’s balance sheet.

“We still expect one further rate hike this year but the unprecedented move to unwind a $4.5 trillion balance sheet could be an additional volatility driver,” Samra added.

At home, miners have been in demand, propping up the FTSE 100, following upbeat data out of China. Glencore (LON:GLEN) is currently the sector’s biggest gainer, having added 1.87 percent to 366.21p.

I Footsie fallers, Provident’s share price has given up 1.70 percent to 868.00p, as analysts at Jefferies downgraded the company to a ‘hold’ and trimmed their valuation on the shares from 3,478p to 940p, in the wake of the group’s profit warning last month.

The FTSE 100 was 0.24 percent up at 7,448.17 points as of 15:00 BST on Friday, 01 September 2017.