London close: Stocks manage gains amid mixed global data

(Sharecast News) - London stocks ended modestly higher on Monday, supported by strength in heavyweight oil majors as investors monitored political developments overseas. The FTSE 100 gained 0.14% to close at 9,221.44, while the FTSE 250 advanced 0.5% to 21,684.45.

"The FTSE 100 ticked higher on Monday as investors shrugged off the weak US jobs numbers which affected sentiment at the end of last week," said AJ Bell investment director Russ Mould.

"Investors were hoping for a Goldilocks number - which was not hot enough to prevent the Federal Reserve from cutting rates when it meets next week but not so tepid that it reignited fears of recession in the world's largest economy."

Gains in BP and Shell helped lift the blue-chip index, offsetting broader caution around global politics.

Patrick Munnelly at TickMill noted that "oil prices increased after OPEC+ came to an agreement on Sunday to gradually boost output next month.

"Crude futures had declined last week due to expectations of a looming rise in production."

In currencies, sterling edged up 0.23% on the dollar to last trade at $1.3540, while it was unchanged versus the euro at €1.1528.

UK jobs market under strain, investor confidence dives on the continent

Economic data painted a picture of mounting uncertainty across global markets, with the UK labour market under strain, eurozone sentiment deteriorating, mixed signals from Germany and China, and investors piling into gold as a safe haven.

On home shores, the latest jobs report from KPMG and the Recruitment and Employment Confederation showed candidate availability rising at the fastest pace since late 2020, while vacancies fell sharply.

Permanent positions were hit hardest, and wage growth slowed to multi-year lows.

"Given the speculation around upcoming Budget measures, it's unlikely we'll see a significant shift in recruitment patterns in the near term," said Jon Holt, UK senior partner at KPMG.

REC chief executive Neil Carberry added: "With fewer vacancies and more candidates looking for work, the overall picture is still subdued. All eyes are now on the autumn Budget."

Chancellor Rachel Reeves confirmed last week that the Budget would be delivered in late November.

Investor sentiment in the eurozone also weakened, with the Sentix confidence index dropping to -9.2 in September, its lowest in five months.

The deterioration was led by Germany, where the overall index fell to -22.1 and the current situation gauge collapsed to -39.0.

Looking abroad, Asian markets were in focus.

"Asia was front of mind for investors at the start of the new week," said Mould.

"If Japanese prime minister Shigeru Ishiba was looking for a pick-me-up after announcing his resignation, he won't have got one from looking at the market reaction to the news."

Munnelly added that "the yen dropped sharply and Japanese markets gained after PM Ishiba announced his resignation.

"Asian markets increased as traders were more confident about potential Fed rate cuts."

China's export performance slowed markedly in August, with shipments up just 4.4% year-on-year compared to 7.2% in July, the weakest pace since February.

Imports rose 1.3%, missing expectations, leaving a trade surplus of $102.3bn.

Against that backdrop, gold surged to record highs above $3,600 per troy ounce, extending a year-long rally that had seen prices climb 44%.

Munnelly said: "Gold prices approached the record high reached on Friday."

M&S jumps on upgrade, Phoenix Group slumps

On London's equity markets, Marks & Spencer climbed 2.89% after Citi upgraded the retailer to 'buy' from 'neutral' and raised its price target to 440p from 380p, arguing that structural tailwinds in the business remain underappreciated.

Oil majors BP and Shell also supported the FTSE 100, adding 0.46% and 0.44% respectively.

On the FTSE 250, PRS REIT surged 5.51% after confirming that private equity giant KKR was taking part in its strategic review and formal sale process, though no offer had yet been made.

Housebuilder Vistry Group rose 1.67% after announcing a long-term investment joint venture with Homes England aimed at accelerating the delivery of large-scale housing projects across the country.

"News of the tie-up is a genuine boost for Vistry's credibility after a difficult period for the company," said Mould.

On the downside, Phoenix Group dropped 7.61% despite reporting a 25% increase in first-half profits and reaffirming its medium-term targets.

"The market reacted negatively as insurer Phoenix renamed itself Standard Life, a brand it acquired four-and-a-half years ago," said Mould.

Reporting by Josh White for Sharecast.com.