By Bansari Mayur Kamdar and Johann M Cherian
(Reuters) – UK’s main index ticked up in choppy trading on Tuesday on gains in commodity linked shares, while mixed labour market data pointed to more headache for the Bank of England looking to rein in surging inflation.
Global investors are also closely tracking crucial inflation figures from the United States ahead of the Federal Reserve’s policy meeting next week. Hopes that the reading would add to recent indications that inflation had peaked buoyed Asian markets earlier in the day.
The benchmark FTSE 100 index rose 0.2% at 8:15 GMT.
Mining stocks added 1.1% to extend a three-day rally as a weaker dollar boosted metal prices.
Oil majors BP and Shell gained 1.3% and 0.8% respectively, as crude prices climbed on concerns over tight supply.
Data on Tuesday showed Britain’s unemployment rate fell to its lowest since 1974 at 3.6% in the three months to July as more people left the labour market, while wages picked up pace adding to signs of price pressures.
It was a strong set of numbers and the (central) bank will be particularly concerned about the wages figures that again have come in on the strong side,” said Stuart Cole, head macro economist at Equiti Capital.
The argument is certainly there for continued aggressive tightening in interest rates because the wages itself are indicative of an underlying boost to inflation in the UK.
Traders now see an 80% chance of a 75 basis-point hike by the BoE next week.
Ocado Group and Marks & Spencer fell 12.2% and 2.2%, respectively, after their joint venture Ocado Retail downgraded its full-year outlook, saying customers are trying to navigate the cost of living crisis by buying fewer products and trading down to cheaper items.
The retail sector, among the worst performing sectors this year, declined 1.2%.
Retail has tumbled 30.7% so far in 2022, as shoppers tightened their belts in the face of rising prices.
Banks eased 0.4%, snapping a three-day rally.
Aveva Group Plc gained 3.1% after Sky News reported that French industrial group Schneider Electric was nearing a deal to take full control of the British software company for about 3.5 billion pounds ($4.1 billion).
(Reporting by Johann M Cherian and Bansari Mayur Kamdar in Bengaluru; Editing by Sriraj Kalluvila)
Why pay for news and opinions when you can get them for free?
Subscribe for free now!
By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact
NEWS3 days ago
Analysis-Schnabel reconciles ECB with markets – until next fight
BUSINESS2 days ago
INVESTING3 days ago
FINANCE3 days ago
Dos and Don’ts in Managing Credit Scores: A Guide for Young Adults