Stock prices in Europe opened in the red on Thursday morning in a data-heavy week for the US, as investors await US jobless figures.
The FTSE 100 index opened down 7.81 points, or 0.1%, at 8,261.79. The FTSE 250 was down just 4.44 points at 20,804.17, and the AIM All-Share was down 1.03 points, or 0.1%, at 758.63.
The Cboe UK 100 was down 0.1% at 826,40, the Cboe UK 250 was up marginally at 18,292.11, and the Cboe Small Companies was unchanged at 16,887.29.
‘Today, eyes are on the ADP report. A consensus of analyst estimates on Bloomberg predict that the US economy may have added 144,000 private jobs last month, a certain rebound from the 122,000 printed a month earlier. A data in line with expectations, or ideally stronger-than-expected, could pour some cold water on the recession worries and keep indices stable into Friday‘s official jobs figures. A softer-than-expected figure on the other hand will likely fuel the recession worries and could further weigh on US treasury yields, the dollar and stock indices,’ explained Swissquote Bank’s Ipek Ozkardeskaya.
In European equities on Thursday, the CAC 40 in Paris was down 1.0%, while the DAX 40 in Frankfurt was down 0.8%.
The pound was quoted at $1.3140 early on Thursday in London, down compared to $1.3147 at the equities close on Wednesday. The euro stood at $1.1083, up against $1.1079. Against the yen, the dollar was trading at JP¥143.30, down compared to JP¥144.24.
In London, Burberry lost 0.5%, after getting relegated from the FTSE 100 index in the latest quarterly reshuffle.
Replacing Burberry will be Hiscox, the Anglo-Bermudan insurance provider, which has seen its share price rise 14% in the year to date, taking its market value above £4 billion. In contrast, Burberry’s share price has plunged 55% following a number of disappointing trading updates.
Burberry will be joined in the FTSE 250 by recently listed, Raspberry Pi, which replaces Alabama-based oil and gas producer, Diversified Energy. Index compiler FTSE Russell said the changes will take effect from the market open on Monday, September 23.
Elsewhere on the FTSE 100, Associated British Foods lost 3.7%.
The group said that it has continued to ‘perform well’ in the second half, though the British weather dampened Primark’s prospects, with like‐for‐like sales expected to decrease by around 0.5% in the second half. Total revenue growth for Primark is expected to be around 4%.
For the Sugar unit, AB Foods described a ‘mixed’ performance. Profitability for the unit remains ahead of financial 2023, but is now below previous expectations. It explained this was due to a sharp fall in European sugar prices.
The Sugar unit is now expected to deliver annual adjusted operating profit for financial 2024 of £200 million. However, operating profit for the overall segment is now expected to be in the range of £50 million to £75 million in financial 2025.
In the FTSE 250, Bakkavor gained 2.9%.
The food manufacturing company reported interim pretax profit of £45.2 million, up from £32.6 million a year prior, while revenue came to £1.12 billion, up 2.8% from £1.09 billion.
The firm declared an interim dividend of 3.20 pence per share, up 10% from 2.91p the year previously. It also upgraded its outlook, raising expectations for annual adjusted operating profit to between £108 million and £112 million.
Separately, Bakkavor also announced that Chief Financial Officer & Asia CEO Ben Waldron is due to step down on October 31, though he will stay at the company until the end of April. Replacing him is UK Finance Director Lee Miley, who will become CFO effective November 1.
Elsewhere, Asos jumped 13%.
The retailer said it has agreed a joint venture with Heartland for both the Topshop and Topman brands. Accordingly, Heartland will own 75% of Topshop and Topman, while Asos will retain 25% and receive £135 million in cash.
In Asia on Thursday, the Nikkei 225 index in Tokyo was down 1.1%. In China, the Shanghai Composite was up 0.1%, while the Hang Seng index in Hong Kong was down 0.4%. The S&P/ASX 200 in Sydney closed up 0.4%.
Chinese leader Xi Jinping on Thursday pledged more than $50 billion in financing for Africa over the next three years and promised to help create at least a million jobs on the continent.
Xi’s comments came during a speech at the opening ceremony of a massive summit in Beijing, gathering dozens of African leaders to discuss the continent’s economic and political ties with China.
Meanwhile, the US State Department denied on Wednesday that China’s consul general in New York had been expelled amid a spying row with Beijing, after the state governor asserted that he had been removed.
In the US on Thursday, Wall Street ended predominantly lower, with the Dow Jones Industrial Average up 0.1%, but the S&P 500 down 0.2% and the Nasdaq Composite down 0.3%.
Kamala Harris and Donald Trump returned to the US campaign trail Wednesday, with new polls showing the White House race remains on a knife-edge less than a week before their crucial first debate.
The match-up comes after the Federal Reserve’s Beige Book showed that more regions in the US reported flat or declining economic activity in recent weeks.
‘Economic activity grew slightly in three Districts, while the number of Districts that reported flat or declining activity rose from five in the prior period to nine in the current period,’ the Beige Book said.
Five Districts saw slight or modest increases in overall headcounts, but a few Districts reported that firms reduced shifts and hours. Wage growth was modest, while increases in non-labor input costs and selling prices ranged from slight to moderate.
Brent oil was quoted at $72.84 a barrel early in London on Thursday from $73.28 late Wednesday.
Gold was quoted at $2,503.90 an ounce against $2,495.10.
Still to come on Thursday’s economic calendar, there are construction PMIs from Germany, France, the eurozone, and the UK. Later in the day, there is a handful of data from the US, including composite PMI, ISM services PMI, and initial jobless claims.
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