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London stock prices were mixed on Tuesday morning with little movement after UK unemployment increased as expected, meanwhile fresh preliminary UK PMI data showed the country’s private sector outperforming in December. The FTSE 100 index opened down 3.49 points at 9,748.19. The FTSE 250 was up 15.32 points, 0.1%, at 22,064.48, and the AIM All-Share was down 0.050 points at 749.18. The Cboe UK 100 was up 0.2% at 977.68, the Cboe UK 250 was marginally higher at 19,145.59, and the Cboe Small Companies was down 0.1 at 17,358.22. UK unemployment rose to 5.1% in the three months to October, up from 5.0% in the three months to September, according to figures released on Tuesday by the Office for National Statistics. The increase in the unemployment rate matched FXStreet-cited consensus expectations and came alongside further signs of easing labour demand. Payrolled employment declined again in November, while earnings growth continued to slow. The ONS said the unemployment rate for those aged 16 and over climbed to 5.1% in the August-to-October period, higher than both the previous quarter and a year earlier. The employment rate for those aged 16 to 64 slipped to around 75%, while the economic inactivity rate edged down to 21%. Average weekly earnings growth softened further. Annual growth in total pay including bonuses eased to 4.7% in the three months to October from 4.9% previously. In the private sector, total pay growth slowed to 4.0%. In real terms, total pay rose 0.6% year-on-year after adjusting for inflation using the consumer prices index including owner occupiers’ housing costs, or CPIH. The number of payrolled employees fell by 22,000 between September and October and was down 149,000 compared with a year earlier, and a provisional estimate for November showed a steeper monthly fall of 38,000, taking total payrolled employment to around 30.3 million. James Smith, developed markets economist for the UK at ING, said the report bolsters the case for Bank of England rate cuts. ‘Wage growth is slowing quickly, at a time when the wider jobs market keeps cooling. The UK is becoming less of an outlier on inflation, and we expect a rate cut on Thursday and two further moves next year,’ he said. AJ Bell head of financial analysis Danni Hewson said the data cover a period that usually sees strong seasonal hiring. ‘This period is slap bang in the middle of what is often referred to as the golden quarter’, when retailers and hospitality businesses bring in thousands of seasonal workers to cope with a festive boom,’ she said. ‘But nerves about potential tax hikes have pushed many people to press pause on their Christmas planning.’ On the monetary policy outlook, Hewson added that slowing wage growth should ‘enable UK rate setters to deliver an interest rate cut later this week’. The pound was quoted at $1.3396 early on Tuesday in London, higher compared to $1.3390 at the equities close on Monday. The euro stood at $1.1754, lower against $1.1764. Against the yen, the dollar was trading at JP¥154.86, down from JP¥155.24. In European equities on Tuesday, the CAC 40 in Paris was up 0.1%, after flash PMI data showed French private sector activity was close to stagnation in December, with easing momentum in services offset by improvement in manufacturing. The HCOB flash France composite PMI output index slipped to 50.1 points in December from 50.4 in November, remaining just above the expansion threshold and marking a two-month low. Services activity softened, while the manufacturing PMI output index rose to 49.7 points from 45.0, a four-month high. The headline manufacturing PMI climbed to 50.6 points from 47.8, its highest level in more than three years. By contrast, the DAX 40 in Frankfurt was down 0.4%, after flash data showed Germany’s private sector lost further momentum in December. The HCOB flash Germany composite PMI output index fell to 51.5 points from 52.4. The overall eurozone’s private sector performed worse than anticipated in December. The flash Hamburg Commercial Bank composite purchasing managers’ output index fell to 51.9 points in December from 52.8 in November, underperforming against FXStreet-cited expectations of an uptick to 53.0 in December. Despite the slowed growth, the eurozone completed a full calendar year of growth for the first time since the Covid pandemic. Back in London, easyJet topped the FTSE 100, up 2.6%, while BAE Systems sat at the other end of the index, down 2.6%. Other defence-focused stocks were also weaker, with Babcock down 1.8% and Rolls-Royce losing 1.1%. On the FTSE 250, IG Group led the gains, up 5.4%, after reporting a sharp rise in quarterly trading revenue and reiterating confidence in meeting market expectations for 2026. IG said net trading revenue in the three months to November 30 rose to £278.2 million from £209.6 million a year earlier, with organic growth of 29%. Total revenue increased 26% to £307.6 million. The group cited stronger customer acquisition, enhanced product offerings and continued double-digit growth in the US and at Freetrade. Net interest income slipped to £29.4 million from £34.0 million as lower rates offset higher cash balances. IG also extended its share buyback programme by £75 million to £200 million and said it expects to deliver mid-point guided revenue growth in 2026. It now expects to report revenue of around £1.10 billion for 2025, up 5% year-on-year. Elsewhere, Touchstar plunged 23% after warning it expects only a small pretax trading profit for financial 2025 and said revenue of around £6.7 million will fall short of market expectations. In Asia on Tuesday, the Nikkei 225 index in Tokyo was down 1.6%. In China, the Shanghai Composite was down 1.1%, while the Hang Seng index in Hong Kong was down 1.5%. The S&P/ASX 200 in Sydney closed down 0.4% In the US on Monday, Wall Street ended lower, with the Dow Jones Industrial Average down 0.1%, the S&P 500 down 0.2% and the Nasdaq Composite 0.6% lower. The yield on the US 10-year Treasury was quoted at 4.16%, narrowing from 4.17%. The yield on the US 30-year Treasury was quoted at 4.84%, widening from 4.83%. Richard Hunter, head of markets at interactive investor, said time is running out for hopes of a year-end rally. ‘Investors continue to fret about the AI trade, which for the moment has fallen sharply out of fashion,’ he said. ‘The rotation into what are seen as relatively stable sectors compared to the previous AI euphoria rumbles on, to the benefit of the likes of industrials, consumer discretionary and healthcare. Oracle and Broadcom continue to be at the eye of the AI storm, falling 2.7% and 5.6% respectively. While Nvidia gained 0.7%, Microsoft also lost 0.8%.’ Tuesday brings delayed US nonfarm payrolls data for October and November, followed by US consumer price inflation data on Thursday. Brent oil was quoted at $59.87 a barrel early in London on Tuesday, down from $60.39 late Monday. Gold was quoted at $4,281.20 an ounce, lower against $4,296.68 late on Monday. Still to come on Tuesday’s economic calendar are Germany’s ZEW economic sentiment survey, US nonfarm payrolls and retail sales, and the US flash composite PMI. UK PMI data is already out, with the composite output PMI up at 52.1 points in December from 51.2 in November, and outperforming expectations of a milder increase to 51.4 in December. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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