FTSE 100 closes higher on Rishi Sunak’s rebound and better US jobs data

Stocks in London ended the week strong on Friday after a stronger than expected US jobs report. On the home front, the race began to find the UK’s next Prime Minister when former Chancellor Rishi Sunak officially launched his candidacy for Number 10.

According to the Bureau of Labor Statistics, employment in the United States rose by 372,000 in June, a slowdown from a downwardly revised figure of 384,000 in May. The June figure exceeded the forecast cited by FXStreet of 268,000.

The FTSE 100 index closed up 7.16 points, or 0.1%, at 7,196.24. The FTSE 250 index closed up 37.42 points, or 0.2%, at 18,912.95. The AIM All-Share Index closed up 6.27 points, or 0.7%, at 886.74.

For the week, the FTSE 100 rose 0.4%, the FTSE 250 gained 1.5% and AIM All-Share added 1.1%.

The Cboe UK 100 ended at 718.08, the Cboe UK 250 closed 0.5% higher at 16,475.90, the Cboe Small Companies edged up 0.2% to 13,226.15.

In Paris, the CAC 40 stock market index ended at 0.4%, while the DAX 40 in Frankfurt ended at 1.3%.

In the FTSE 100, JD Sports Fashion closed 2.5% higher after the sportswear retailer named Andy Higginson as chairman following an ‘extensive research process’ in a bid to end persistent corporate governance concerns.

Higginson was previously chairman of supermarket chain Wm Morrison from 2015 until its private equity takeover in November. He is also currently a senior independent director at Flutter.

In June, the company said the process of recruiting a new non-executive chairman was “moving at a steady pace” and that a “number of high-calibre candidates” for the post of chief executive were being considered.

In May, Peter Cowgill stepped down as Executive Chairman effective immediately. In July 2021, JD Sports bowed to shareholder pressure over its corporate governance, agreeing to split its roles as chairman and CEO.

Energy stocks ended in the green, trailing spot oil prices higher. BP closed up 0.6%, Shell up 0.6% and Harbor Energy up 2.1%. Mid-cap oil stocks Energean and Tullow Oil closed up 3.3% and 5.6% respectively.

Additionally, Harbor said EIG’s notifiable stake in the company fell to around 16% from around 37%. The North Sea-focused oil producer said the change reflected a distribution of EIG’s stake in Harbor to some of its underlying investors rather than a sale of shares.

In addition, he said EIG is now only entitled to one shareholder-appointed director on Harbor’s board. Nonetheless, the board asks the GIE-appointed directors, R Blair Thomas and Steve Farris, to remain on the board in light of their “extensive” experience and valuable contributions.

Brent oil was quoted at $106.00 a barrel at the close of trading, down from $105.66 at the close on Thursday.

In the FTSE 250, Marks & Spencer fell 3.0% after Goldman Sachs downgraded the high street stalwart to ‘sell’ from ‘neutral’.

The pound was listed at $1.2040 at the close of London stocks, down from $1.2002 at the close on Thursday.

On the political front, former UK Chancellor Rishi Sunak, whose resignation from Prime Minister Boris Johnson’s cabinet helped spark a mass exodus of other ministers, has become the first high-profile MP to declare his candidacy to become the next party leader.

“Let’s restore confidence, rebuild the economy and bring the country together,” the former finance minister said, featuring a clever video about his life story to kick off the social media campaign.

The euro stood at $1.0185 at the close of European stocks, down from $1.0172 on Thursday night. The common eurozone currency fell to an intraday low of $1.0072 at the start of trading – its lowest level since late 2002.

The single currency has wobbled towards parity with the dollar on growing fears that Russia could cut off gas supplies to Europe and push the region into recession, making it harder for the ECB to tighten policy monetary.

Against the yen, the dollar was trading at JP¥135.88, down from JP¥135.91 on Thursday evening.

Former Japanese Prime Minister Shinzo Abe was assassinated on Friday by a gunman who opened fire at close range as the hugely influential politician was delivering a campaign speech.

The murder of the 67-year-old, who had been Japan’s longest-serving leader, stunned the nation and sparked an international outpouring of grief and condemnation.

It was all the more shocking given Japan’s strict gun laws and low violent crime rates, with Prime Minister Fumio Kishida describing the killing as a “barbaric act” that was “absolutely unforgivable”.

Abe, who served in office in 2006 for a year and then from 2012 to 2020, was shot dead shortly before noon while campaigning in the western Nara region ahead of weekend upper house elections.

Shares in New York were higher at the close of shares in London. The DJIA rose 0.1%, the S&P 500 index 0.2% and the Nasdaq Composite 0.1%.

Twitter fell 3.8% following a Washington Post report that Elon Musk’s $44 billion deal to buy the social media giant was in jeopardy.

Gold stood at $1,744.88 an ounce at the close of London stocks, firm against $1,742.44 on Thursday night.

Monday’s calendar of economic events features a trade statement from homebuilder MJ Gleeson.

Monday’s UK Business Calendar has the US Employment Trends Index at 1500 BST.

Copyright 2022 Alliance News Limited. All rights reserved.

Date of issue: Jul 08, 2022

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