(Alliance News) - Stocks in London are set for a marginally lower start on Thursday as UK unemployment rate unexpectedly rose in the quarter to May.
IG says futures indicate the FTSE 100 index of large-caps to open down 10.79 points, or 0.2%, at 7,080.40 on Thursday. The FTSE 100 index closed down 33.53 points, or 0.5%, at 7,091.19 on Wednesday.
The UK unemployment rate edged up in the three months to May, but data pointed to a recovery in the labour market in June, the Office for National Statistics said on Thursday.
The unemployment rate for the three months to May was 4.8%, up from 4.7% for the three months to April. This was ahead of market expectations, according to FXStreet, which saw the unemployment rate remaining unchanged. The jobless rate started 2021 at 5.0%, representing the three months to January.
However, the labour market appears to have bounced back again in June. The number of payrolled employees has increased, with some regions now reaching above pre-pandemic levels, the ONS said. The number of payroll employees was up by 356,000 in June to 28.9 million.
Still, this remains 206,000 below pre-virus levels.
Sterling was quoted at USD1.3854 early Thursday, soft on USD1.3870 at the London equities close on Wednesday.
The euro traded at USD1.1840 early Thursday, up from USD1.1825 late Wednesday. Against the yen, the dollar slipped back after three days of gains. The greenback was quoted at JPY109.79, down versus JPY110.02 late Wednesday.
In early UK company news, food delivery firm Just Eat Takeaway.com oposted growth in second-quarter orders, said it has gained market share in the UK, and added that its losses peaked in the first half and margins will pick up from here on in.
The company also boosted its annual guidance. It now expects order growth of "more than" 45% for 2021, excluding new US acquisition Grubhub, raised from its previous forecast of order growth of more than 42%.
Total orders excluding the US rose 47% year-on-year to 212.4 million in the second quarter of 2021, from 144.9 million.
"The company's efforts in the historically under-invested legacy Just Eat markets have continued to drive growth and win online share. Just Eat gained online share in the UK, including a significant inflection in London with triple-digit order growth in the first half of 2021 compared with the first six months of 2020," Just Eat Takeaway said.
NortonLifeLock and Avast confirmed they are in advanced talks regarding a possible combination.
A deal may be in form of a cash and share takeover offer by Norton for Avast, the two companies said. Possible terms were not disclosed.
The talks were first reported by the Wall Street Journal late on Wednesday. A deal could value Avast at around USD8 billion, assuming a typical premium to its closing market capitalisation of USD5.20 billion, the WSJ said.
Under UK takeover rules, Norton will have to make a firm offer by August 11, or announce it will not make an offer.
Information services company Experian said it has delivered a strong performance in the three months to June 30.
Total revenue growth was 31% at actual exchange rates and 28% at constant exchange rates in the first quarter. Organic revenue growth was 22%, and all regions and segments delivered growth for the quarter.
The company said its improved performance was driven by an innovation-led strategy and a faster-than-expected recovery as economies emerge from the Covid-19 pandemic.
Experian said it now expects total revenue growth for the full financial year to March 31, 2022 in the range of 13% to 15%.
Online fashion retail ASOS said revenue growth in the four months to June was strong. However, trading in the last three weeks of the period was more muted, as demand was hurt by continued Covid uncertainty.
"Although mindful of the continued impacts of the pandemic on our customers in the short term, we believe that the structure of the global e-commerce fashion market has changed forever, which will drive an increase in online fashion sales over the long term," said Chief Executive Nick Beighton.
Looking ahead, ASOS said it anticipates a measure of volatility to continue in the near term, given the rapidly evolving Covid situation worldwide. Despite that, the retailer expects to deliver its overall full year adjusted pretax profit in line with its expectations.
In Asia on Thursday, the Japanese Nikkei 225 index closed down 1.2%. In China, the Shanghai Composite was up 1.0%, while the Hang Seng index in Hong Kong advanced 1.0%. The S&P/ASX 200 in Sydney closed down 0.3%.
China's sharp economic rebound from last year's pandemic slowdown lost steam in the second quarter, official data showed Thursday, with consumers lacking the confidence to splurge.
The world's second-largest economy has staged a rapid recovery from last year's slump caused by the coronavirus pandemic, but its pace is easing with manufacturing slowing and consumer demand not picking up as quickly as expected.
China's GDP growth came in at 7.9% on-year in the April to June period, said the National Bureau of Statistics – a significant drop from the 18% surge in the first three months.
Still ahead in the economic events calendar on Thursday are the latest US jobless claims numbers at 1330 BST. In addition, Powell's testimony on Capitol Hill continues.
US central bank will continue to provide stimulus until the economy has fully recovered, Federal Reserve Chair Jerome Powell said Wednesday.
Powell acknowledged that the inflation spike was stronger than the Fed was hoping to see, and will remain "elevated" in coming months, but he again expressed confidence the rate will decline once supply bottlenecks and other temporary issues are resolved.
Gold was quoted at USD1,828.73 an ounce early Thursday, higher than USD1,822.70 on Wednesday. Brent oil was trading at USD74.26 a barrel, down from than USD76.16 late Wednesday.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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