U.K. overall employment falls in three-month period to September
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Stocks in the U.K. closed lower on Wednesday, as a slide in oil prices pulled energy producer shares into the red and a drop in metals prices knocked down prices for miners.
U.K. data on wages were slightly above expectations, but pay for Britons is still falling when adjusted for inflation. Meanwhile, stocks were tracking sharp losses for U.S. stocks.
What markets are doing: The FTSE 100 index dropped 0.6% to end at 7,372.61, logging a fifth straight day of losses -- its longest losing run since March, according to FactSet data.
The pound traded at $1.3162, little changed from $1.3165 late Tuesday in New York. It had briefly risen above $1.3200 after U.K. jobs data were released. Against the euro, sterling bought EUR1.1158, unchanged from EUR1.1158 in the prior session.
Commodities pressure: Prices for oil and most metals were under pressure, which in turn weighed on shares of energy producers and mining companies.
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Oil and Brent futures slumped more 0.7% Wednesday, extending losses logged Tuesday after the American Petroleum Institute posted an unexpected rise in weekly U.S. inventories for both crude oil and gasoline (http://www.marketwatch.com/story/api-data-reportedly-shows-an-unexpected-jump-in-us-crude-supplies-2017-11-14). The losses deepened in the afternoon after data from the U.S. Energy Information Administration showed domestic crude supplies rose last week (http://www.marketwatch.com/story/oil-extends-losses-as-eia-reports-a-second-straight-weekly-rise-in-us-crude-supplies-2017-11-15), going against forecasts that had predicted a decline.
Thomas Kee: To make money in oil, listen to prices more than news (http://www.marketwatch.com/story/to-make-money-in-oil-listen-to-prices-more-than-news-2017-11-14)
Copper prices gave up 0.2%, building on Tuesday"s fall. That move came after disappointing Chinese data on industrial output (http://www.marketwatch.com/story/china-industrial-output-slows-in-oct-as-expected-2017-11-13) and housing sales (http://www.marketwatch.com/story/china-housing-sales-slow-year-over-year-in-october-2017-11-13) prompted concerns about slowing growth the world's second-largest economy.
The oil and gas and basic materials sectors have a 24% weighting on the FTSE 100, according to FactSet data.
What's moving markets: U.K. and European stocks were tracking losses for U.S. stocks (http://www.marketwatch.com/story/dow-futures-tumble-more-than-100-points-as-mood-for-risk-sours-2017-11-15) that were rattled by concerns about delays to tax reforms from Washington. Republican senators are strongly considering adding a repeal of Obamacare's individual insurance mandate (http://www.marketwatch.com/story/senate-republicans-strongly-consider-adding-obamacare-mandate-repeal-to-tax-bill-report-2017-11-14) to a new version of their tax bill, Politico reported.
Read:Here's what happens if Obamacare mandate is repealed, as Senate is considering (http://www.marketwatch.com/story/heres-what-happens-if-obamacare-mandate-is-repealed-as-senate-is-considering-2017-11-14)
Britain's Office for National Statistics released employment and wage figures on Wednesday. The overall employment number fell in the July-September period, the first decline since 2015. Average annual wage growth remained at 2.2%, meaning that Britons' wages fell by 0.5% when adjusted for inflation (http://www.marketwatch.com/story/uk-employment-drops-for-1st-time-in-2-years-2017-11-15).Inflation currently stands at 3% (http://www.marketwatch.com/story/uk-inflation-stays-at-5-year-high-of-3-2017-11-14), above the Bank of England's target of 2%.
What strategists are saying: "There has been a muted reaction from the pound ... off the back of a rather curious labor market report. Whilst wage growth figures beat expectations, the employment rate surprised by dipping slightly," said Hamish Muress, currency analyst at OFX, in a note.
"The Bank of England will be relieved to see the gap between wage growth and inflation narrow, but may now be asking whether the U.K. has reached its maximum employment rate. If this is the case, then wage growth could accelerate further in 2018," he wrote.
"Repealing the [Obamacare] individual mandate generates an estimated $340 billion in savings but could also lead to GOP defections as with Obamacare repeal," Elsa Lignos, global head of FX strategy at RBC Capital Markets, in a note.
Stock movers: Shares of oil producers Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) and BP PLC (BP.LN) (BP.LN) shed 1.5% and 1.6%, respectively, as oil prices lost ground.
Among miners, Glencore PLC (GLEN.LN) shares ended 1.4% lower, Rio Tinto PLC (RIO) (RIO) (RIO) gave up 0.9%, and Anglo American PLC (AAL.LN) erased 1.2%.
Experian PLC (EXPN.LN) fell 1.5% after the credit monitoring service said if might face greater scrutiny after the data breach at rival Equifax Inc. (EFX) .
Barratt Developments PLC (BDEV.LN) shares slipped 1.1% even as the home builder said total forward sales rose 8.4%, indicating a strong start to the new financial year (http://www.marketwatch.com/story/barratt-developments-sees-strong-start-to-new-year-2017-11-15).
(END) Dow Jones Newswires
November 15, 2017 12:34 ET (17:34 GMT)