London pre-open: Stocks seen up as investors mull jobs data

(Sharecast News) - London stocks were set to rise at the open on Tuesday following a late bounce on Wall Street, as investors mulled the latest UK jobs data. The FTSE 100 was called to open 22 points higher at 7,531.

CMC Markets analyst Michael Hewson said: "While the sharp fall in oil prices grabbed most of the headlines yesterday, the same cannot be said for gas prices, which finished the day sharply higher, and that is where the main headwind is for markets in Europe.

"US markets also managed to claw their way back into positive territory after a poor start, despite a horrendous Empire Fed manufacturing survey, with the main focus this week set to be on the US consumer, ahead of retail sales data for July, as well as the latest quarterly numbers from US consumer bellwethers Target and Walmart, after their recent profit warnings.

"This US rebound looks set to translate into a positive open for European markets this morning."

On home shores, figures from the Office for National Statistics showed that average total pay including bonuses rose 5.1% between April and June, with regular pay excluding bonuses up 4.7%.

However, adjusted for inflation, total pay fell 2.5% and regular pay was down by a record 3%.

Adrian Lowery, financial analyst at UK wealth manager Evelyn Partners, said "soaring inflation is really starting to eat into spending power".

"The difficulty for workers now in both public and private sectors is that increased pay demands to cope with inflation must contend with the depressed economic outlook, and employers' uncertainty over their own earnings.

"The robust UK labour market seems to be at a plateau, with employers squaring their current need to attract and retain employees with the clouds of economic weakening on the horizon. A leading indicator of caution could be the first fall in the number of job vacancies since June to August 2020: there were 1.274 million in May to July 2022, a decrease of 19,800 from the previous quarter."

In corporate news, software company Sage Group said it had bought Lockstep, a provider of cloud native technology that automates accounting workflows between companies, for an undisclosed sum.

Pipe maker Genuit reported a fall in interim profits but maintained full-year guidance as revenues rose during the period due to a strong UK housing market.

The company, formerly known as Polypipe, said pre-tax profit in the six months to June 30 fell 2.7% to £33m on revenues up 7.6% to £318m.