London midday: Stocks maintain mild losses ahead of payrolls
London stocks were still slightly lower by midday on Friday as investors eyed the release of the latest US non-farm payrolls report, with miners and housebuilders under pressure.
The FTSE 100 was down 0.2% at 7,586.24, while the pound was off 0.3% against the dollar at 1.2543 and 0.1% lower versus the euro at 1.1139.
CMC Markets analyst Michael Hewson said: "Today’s US payrolls report has the potential to upset the apple cart when it comes to whether or not we can expect to see a Fed rate cut later this month, and if we do whether it will be 25 or 50 basis points.
"Currently market pricing is at a 100% certainty that we will get some form of move from the FOMC when they meet at the end of this month, despite data that while by and large is a little softer, isn’t screaming economic slowdown."
The payrolls report is due at 1330 BST, along with the unemployment rate and average earnings.
The payrolls are expected to show a 160,000 increase in June, compared to a 75,000 jump the month before, while average hourly earnings are expected to have edged up 3.2% versus 3.1% in May and the unemployment rate is forecast to be unchanged at 3.6%.
On home turf, the latest survey from Halifax showed that house prices fell slightly in June but the annual trend strengthened.
Prices dipped 0.3% last month to an average of £237,110 following a 0.4% increase in May. For the three months to June, prices were up 5.7% from a year earlier after rising 5.2% in the three months to May.
Halifax said the 5.7% annual growth figure was affected by particularly low growth a year earlier. House prices were 2.4% higher in the three months to June than in the preceding three months.
The figures appear to show property prices holding up reasonably well amid political and economic uncertainty. But other surveys have been weaker, including rival lender Nationwide's figures, which showed an annual percentage rise of just 0.6%.
Russell Galley, Halifax's managing director, said: "Recent industry figures show demand looking slightly more stable, with mortgage approvals ticking along just above the long-term average."
But Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the Halifax figures made little sense.
"Halifax’s data remain implausibly strong and irreconcilable with all other measures of house price growth," Tombs said. "The housing market has little momentum, though a modest revival later this year is likely if lenders reduce mortgage rates in response to the recent fall in their funding costs."
In equity markets, miners were under the cosh amid falling iron ore and copper prices. Iron ore prices were hit by news that China's top mills have formed a group to investigate whether "non-market factors" are causing the surge in prices. They are said to have called on the government to maintain market stability. Rio Tinto, Anglo American, Antofagasta, Glencore and BHP were all weaker.
Building materials supplier SIG suffered heavy losses as it said weak construction markets in the UK and Ireland led to a 3.8% fall in first half like-for-like sales. Housebuilders took a knock following SIG's update, with Persimmon, Taylor Wimpey and Berkeley Group all lower.
Ferrexpo was also in the red even as it reported a 5% increase in first-half iron pellet production and reiterated its full-year guidance.
Spectris shares were under the cosh after Bank of America Merrill Lynch double-downgraded its recommendation to 'underperform'. Wood Group went the other way, boosted by an upgrade to 'buy' from 'hold' at Berenberg.
Outside the FTSE 350, aviation services business John Menzies saw its shares tumbled after it warned over its full-year earnings, pointing to challenges in the wider aviation market such as weak cargo volumes and flight reductions.
Shares of Funding Circle racked up healthy gains, having slumped earlier in the week after the lender halved its forecast for 2019 revenue growth.
FTSE 100 - Risers
Fresnillo (FRES) 890.40p 2.27%
Vodafone Group (VOD) 134.81p 1.42%
British American Tobacco (BATS) 3,007.53p 1.37%
Centrica (CNA) 88.64p 1.23%
Sainsbury (J) (SBRY) 202.90p 1.20%
Imperial Brands (IMB) 1,977.20p 1.03%
Tesco (TSCO) 237.20p 0.98%
Coca-Cola HBC AG (CDI) (CCH) 2,895.00p 0.98%
Hargreaves Lansdown (HL.) 2,052.00p 0.88%
Morrison (Wm) Supermarkets (MRW) 210.00p 0.67%
FTSE 100 - Fallers
Rio Tinto (RIO) 4,777.50p -2.73%
Persimmon (PSN) 1,911.02p -2.70%
Aveva Group (AVV) 3,974.94p -2.14%
Evraz (EVR) 639.20p -2.11%
Anglo American (AAL) 2,148.00p -1.98%
BHP Group (BHP) 1,973.00p -1.89%
Antofagasta (ANTO) 893.00p -1.80%
Berkeley Group Holdings (The) (BKG) 3,725.00p -1.79%
Taylor Wimpey (TW.) 158.42p -1.69%
Intertek Group (ITRK) 5,630.00p -1.64%
FTSE 250 - Risers
Funding Circle Holdings (FCH) 139.60p 7.55%
Intu Properties (INTU) 79.47p 4.08%
Wood Group (John) (WG.) 492.60p 3.97%
Drax Group (DRX) 276.60p 2.83%
Contour Global (GLO) 190.20p 2.70%
Pantheon International (PIN) 2,243.60p 2.45%
Hunting (HTG) 526.50p 2.23%
Hochschild Mining (HOC) 197.08p 2.17%
Vivo Energy (VVO) 125.60p 2.11%
Sanne Group (SNN) 715.00p 1.56%
FTSE 250 - Fallers
Spectris (SXS) 2,743.00p -4.99%
SIG (SHI) 126.10p -4.76%
Victrex plc (VCT) 2,070.00p -4.43%
Kaz Minerals (KAZ) 558.00p -3.23%
Polypipe Group (PLP) 437.40p -3.19%
Ferrexpo (FXPO) 262.90p -3.10%
Metro Bank (MTRO) 529.50p -3.02%
Elementis (ELM) 135.60p -3.00%
Vesuvius (VSVS) 543.00p -2.69%
Amigo Holdings (AMGO) 177.30p -2.48%