Sterling slumps vs. dollar after upbeat U.S. data on job openings
U.K. stocks nabbed slight gains Tuesday, closing at their highest level since early June, helped by the pound's drop against the dollar following an upbeat reading on U.S. job openings.
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The FTSE 100 index rose 0.1% to end at 7,542.73, giving the gauge its strongest finish since June 2. It briefly traded above its all-time closing high of 7,547.63 hit in late May, but couldn't stay atop that level.
The British blue-chip benchmark flipped positive in afternoon action as the pound lost ground in the wake of a U.S. release saying the number of job openings there rose to a fresh record (http://www.marketwatch.com/story/job-openings-climb-to-record-616-million-in-june-2017-08-08).
A weaker sterling can boost the FTSE 100, as many of the index's multinational companies generate most of their profit in foreign-denominated currencies.
"It seems that the JOLTS job openings reading--which far surpassed expectations at 6.16 million against last month's 5.67 million--mainly benefited the dollar, which is currently on the hunt for the faintest whiff of good news," said Connor Campbell, a financial analyst at Spreadex, in a note.
The pound slumped after the figure was released and that "helped the FTSE edge back into the green," Campbell added.
The pound on Tuesday recently bought $1.2966, down from $1.3036 late Monday in New York.
Miners make moves: Mining stocks initially were under pressure Tuesday after the release of Chinese trade data (http://www.marketwatch.com/story/china-export-growth-slows-but-up-for-5th-month-2017-08-08), which showed July exports and imports grew at a slower pace than in recent months. But they managed to erase losses. Shares in iron-ore producer BHP Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU) closed 0.1% higher, while peer Rio Tinto PLC (RIO) (RIO) (RIO) gave up 0.3%.
"On the import side, the slowdown appears to have been driven by fewer imports of industrial commodities. Softer import volumes, rather than lower prices, are mostly to blame," said Julian Evans-Pritchard, an economist at Capital Economics who covers China, in a note.
"This hints at a possible slowdown in domestic demand last month," he said. China is a major buyer of both industrial and precious metals.
Mining stocks on Monday rose, keying off a rally in iron ore prices.
Store sales: Retail shares shook off early weakness that had come as the British Retail Consortium said U.K. retail sales in July slowed from a year ago. Sales rose 0.9%, compared with 1.1% a year earlier.
Next PLC shares (NXT.LN) were lower, but finished up by 0.9%. Marks & Spencer Group PLC (MKS.LN) gained 1%, and DIY retailer Kingfisher PLC (KGF.LN) picked up 1.3%
Other movers: Meanwhile, shares of Standard Life PLC (SL.LN) lost 0.3% after the financial services company posted a 14% decline in first-half pretax profit (http://www.marketwatch.com/story/standard-life-profit-drops-14-hikes-dividend-2017-08-08), hurt by a fall in revenue and investment returns. Standard Life did raise its interim dividend to 7 pence a share.
InterContinental Hotels shares (IHG) (IHG) slid 4% on concerns about slower room-revenue growth. First-half pretax profit rose 9.4% (http://www.marketwatch.com/story/intercontinental-hotels-profit-raises-dividend-2017-08-08), and the company, whose brands include Holiday Inn and Crowne Plaza, raised its interim dividend by 10%.
(END) Dow Jones Newswires
August 08, 2017 12:27 ET (16:27 GMT)