London open: Stocks edge up pre-payrolls but Indivior tanks on court ruling

Fri 01 Sep 2017

LONDON (SHARECAST) - (ShareCast News) - London stocks edged tentatively higher in early trade on Friday as investors eyed the release of the US non-farm payrolls report later in the day.
At 0830 BST, the FTSE 100 was up 0.2% to 7,447.45, while the pound was flat against the euro at 1.0861 and down 0.1% versus the dollar at 1.2912.

On the data front, Markit's UK manufacturing purchasing managers' index is at 0930 BST. In the US, the payrolls report, unemployment rate and average hourly earnings are at 1330 BST.

Spreadex analyst Connor Campbell said: "The main focus for the UK this morning - at least until this afternoon's non-farm jobs report from America and its associated rate hike intrigue - is August's manufacturing PMI. Analysts are expecting a very slight dip, from 55.1 to 55.0 month-on-month. However since the year began estimates have rarely been accurate, something that perhaps explains investors' early reticence."

As far as the payrolls report is concerned, consensus is for a gain of 180,000, which would be down a little from July's 209,000 but would still keep the six-month rolling average above 180,000. Meanwhile, the unemployment rate is expected to hold steady at 4.3%, back at lows last seen over 16 years ago, and before then back in the late sixties.

David Morrison, senior market strategist at SpreadCo, said: "This low rate of unemployment has led some FOMC members to worry that inflation could suddenly surge higher. Certainly the employment picture has been improving across the eurozone, Japan and UK, where central banks have kept monetary policy loose. This is why investors will also keep a close eye on today's average hourly earnings release as any pick-up in wage growth should encourage the hawks within the Fed."

In corporate news, Indivior tanked nearly 38% as it said there was a "material" risk to revenue after a US court ruled that a generic version of its Suboxone film to treat opioid addiction by Dr Reddy's does not infringe any of the London-listed company's patents. Indivior - for which Suboxone represented around 80% of revenue last year - is set to appeal the decision.

Digital property and household-related services owner ZPG rose after announcing the acquisition of Ravensworth, the "UK's leading provider" of on-demand print and creative marketing services to estate and letting agents, for an undisclosed sum.

Rio Tinto was in the black after confirming the completion of the sale of its wholly-owned subsidiary Coal & Allied Industries Limited to Yancoal Australia, while Rathbone Brothers edged higher after merger talks with wealth manager Smith & Williamson collapsed on Thursday.

Greene King was hit by a downgrade to 'reduce' at HSBC, while JD Wetherspoon fell after a downgrade to 'hold' by the same outfit.

Dixons Carphone was dragged lower by a cut to 'hold' at Investec and Micro Focus traded sharply lower as it completed its merger with HPE Software, returned capital and consolidated its shares.

Market Movers

FTSE 100 (UKX) 7,447.45 0.23%
FTSE 250 (MCX) 19,739.90 -0.32%
techMARK (TASX) 3,414.21 -0.13%

FTSE 100 - Risers

London Stock Exchange Group (LSE) 4,019.00p 1.75%
Anglo American (AAL) 1,426.00p 1.68%
TUI AG Reg Shs (DI) (TUI) 1,325.00p 1.30%
Coca-Cola HBC AG (CDI) (CCH) 2,674.00p 1.13%
Glencore (GLEN) 363.30p 1.06%
Convatec Group (CTEC) 289.60p 0.94%
Smurfit Kappa Group (SKG) 2,384.00p 0.93%
ITV (ITV) 159.90p 0.82%
Tesco (TSCO) 182.35p 0.80%
Hargreaves Lansdown (HL.) 1,411.00p 0.79%

FTSE 100 - Fallers

Micro Focus International (MCRO) 2,244.00p -8.55%
Royal Mail (RMG) 386.30p -2.00%
Provident Financial (PFG) 867.50p -1.76%
Kingfisher (KGF) 296.00p -0.97%
Persimmon (PSN) 2,639.00p -0.75%
Johnson Matthey (JMAT) 2,745.00p -0.69%
Taylor Wimpey (TW.) 199.50p -0.50%
Next (NXT) 4,113.00p -0.39%
Centrica (CNA) 199.30p -0.30%
British American Tobacco (BATS) 4,817.00p -0.29%

FTSE 250 - Risers

Ascential (ASCL) 384.50p 2.37%
Sophos Group (SOPH) 514.50p 2.29%
BBA Aviation (BBA) 308.20p 2.12%
Kaz Minerals (KAZ) 855.50p 1.78%
Rank Group (RNK) 234.10p 1.78%
Acacia Mining (ACA) 205.90p 1.73%
Safestore Holdings (SAFE) 420.10p 1.60%
Syncona Limited NPV (SYNC) 166.50p 1.59%
PayPoint (PAY) 934.50p 1.52%
JD Sports Fashion (JD.) 328.80p 1.45%

FTSE 250 - Fallers

Indivior (INDV) 259.80p -37.64%
Greene King (GNK) 663.00p -3.84%
Dixons Carphone (DC.) 167.40p -3.46%
Marston's (MARS) 113.70p -1.56%
Pershing Square Holdings Ltd NPV (PSH) 1,036.00p -1.52%
Cobham (COB) 135.30p -1.46%
Ladbrokes Coral Group (LCL) 116.80p -1.43%
Wetherspoon (J.D.) (JDW) 1,077.00p -1.37%
Nostrum Oil & Gas (NOG) 373.60p -1.37%
Halfords Group (HFD) 318.80p -1.27%
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