London midday: FTSE rallies after soft UK jobs data

(Sharecast News) - London stocks had extended gains by midday on Tuesday as investors scaled back rate hike expectations after the latest UK jobs report, and as US president Donald Trump cancelled a planned military attack on Iran. The FTSE 100 was 0.7% firmer at 10,398.48, while Brent crude was down 1.5% at $110.47 a barrel.

Sentiment was boosted after Trump said in a post on Truth Social on Monday that the US was holding off on a military attack on Iran that had been planned for Tuesday. This was at the request of several Gulf states, Trump said, who had told him that a deal will be made, "which will be very acceptable to the United States of America, as well as all Countries in the Middle East, and beyond".

"This Deal will include, importantly, NO NUCLEAR WEAPONS FOR IRAN," Trump added.

In the same post, however, Trump also insisted the US remains ready to act and is "prepared to go forward with a full, large scale assault of Iran, on a moment's notice, in the event that an acceptable Deal is not reached".

On home shores, figures from the Office for National Statistics showed that unemployment ticked higher in the first quarter, while wage growth slowed.

The unemployment rate in January to March was estimated to be 5.0%, up 0.5 percentage points year-on-year but down 0.1 percentage points on the previous three months. It was marginally higher than consensus of 4.9%.

Annual growth in employees' average regular earnings, which exclude bonuses, was 3.4%, in line with expectations.

ONS director of economic statistics, Liz McKeown, said the latest figures suggest the labour market remains soft, with vacancies at their lowest level in five years and unemployment higher than a year ago.

"The number of payroll employees continued to fall in the three months to March, while regular wage growth slowed further," she said.

"Lower-paying sectors such as hospitality and retail have seen some of the largest falls in vacancies and payroll numbers, both in recent months and over the last year.

"Early estimates of the number of people on payroll in April point to further weakness. However, at the start of the new tax year, these figures carry greater uncertainty and have often seen larger than average upward revisions."

Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: "President Trump's decision to hold off on a fresh round of attacks on Iran has raised hopes that a deal may be close, helping ease some of the immediate heat in oil markets. But even if tensions cool from here, supply will not ramp back up overnight, leaving investors facing the prospect of elevated oil prices for a while yet. That could make for an uncomfortable few months, with higher energy costs feeding through to businesses and consumers."

As far as the UK jobs data is concerned, Britzman said it puts a softer labour market back at the centre of the rates debate, and may help take some heat out of the recent rise in gilt yields. "Payroll employment fell sharply in April, while vacancies and claimant numbers also point to a hiring backdrop that has weakened since the Iran war began," he said.

"The important point for markets is that businesses appear to be responding to higher costs by cutting headcount, not by pushing wages materially higher to compensate workers. That should help keep the coming inflation spike contained to a short-term energy shock rather than the start of a wage-price spiral, giving the Bank of England a little more room to sit tight rather than rush into further rate hikes."

In equity markets, IG Group jumped to the top of the FTSE 100 as it lifted its guidance for 2026 and its medium-term outlook following a strong first quarter.

Diploma surged as it boosted annual guidance for the second time after interim earnings rocketed.

Electricals retailer Currys gained after saying full-year profit was set to be just above guidance as it hailed strong performances in the UK & Ireland and the Nordics.

Dr Martens jumped as the iconic bootmaker reported a sharp increase in annual profits as its move to more full-price sales started to pay off.

Food producer Cranswick rose as it hiked its dividend and reported a rise in full-year profit and revenue amid strong demand across its core categories.

SSP Group advanced as it backed its full-year outlook despite the impact of the Iran war on travel and said like-for-like sales in the first six weeks of its second half rose 3% compared to 5% in the first two quarters of the fiscal year.

On the downside, heavily-weighted miners slumped, with Rio Tinto, Antofagasta, Glencore and Anglo American all lower as metals prices, including copper, fell.

Standard Chartered edged lower as it announced plans to cut nearly 8,000 jobs and set higher medium-term profitability targets.

Market Movers

FTSE 100 (UKX) 10,398.48 0.72% FTSE 250 (MCX) 22,805.16 0.86% techMARK (TASX) 5,925.59 1.10%

FTSE 100 - Risers

IG Group Holdings (IGG) 1,724.00p 9.39% Airtel Africa (AAF) 329.80p 5.37% Diploma (DPLM) 6,955.00p 4.98% 3i Group (III) 2,179.00p 4.56% Rightmove (RMV) 424.10p 4.28% JD Sports Fashion (JD.) 75.60p 2.91% Experian (EXPN) 2,736.00p 2.79% The Sage Group (SGE) 906.40p 2.74% Severn Trent (SVT) 3,016.00p 2.65% Next (NXT) 12,965.00p 2.65%

FTSE 100 - Fallers

Rio Tinto (RIO) 7,560.00p -2.23% Antofagasta (ANTO) 3,726.00p -1.69% Glencore (GLEN) 566.20p -1.34% Anglo American (AAL) 3,744.00p -1.11% Fresnillo (FRES) 3,309.00p -0.72% Standard Chartered (STAN) 1,911.50p -0.62% Smurfit Westrock (DI) (SWR) 2,797.00p -0.61% Compass Group 11 (CPG) 32.61p -0.37% Aviva (AV.) 629.20p -0.32% Alliance Witan (ALW) 1,300.00p -0.23%

FTSE 250 - Risers

Currys (CURY) 144.00p 13.29% Dr. Martens (DOCS) 69.60p 8.24% Kainos Group (KNOS) 885.50p 7.99% Cranswick (CWK) 5,590.00p 7.47% WPP (WPP) 286.40p 4.29% Hilton Food Group (HFG) 562.50p 4.17% Ocado Group (OCDO) 207.00p 4.13% Frasers Group (FRAS) 718.00p 3.91% Trustpilot Group (TRST) 246.20p 3.80% SSP Group (SSPG) 160.20p 3.76%

FTSE 250 - Fallers

Aston Martin Lagonda Global Holdings (AML) 46.20p -3.19% Polar Capital Technology Trust (PCT) 647.00p -1.82% Patria Private Equity Trust (PPET) 600.00p -1.64% Pacific Horizon Inv Trust (PHI) 1,086.00p -1.63% Ceres Power Holdings (CWR) 711.00p -1.53% Raspberry PI Holdings (RPI) 688.50p -1.51% Caledonia Investments (CLDN) 366.00p -1.48% Templeton Emerging Markets Inv Trust (TEM) 303.00p -1.46% JPMorgan Emerging Markets Dividend Income (JEMI) 193.50p -1.28% Hochschild Mining (HOC) 600.00p -1.24%