LONDON MARKETS: FTSE 100 Wavers Around 5-week High, With U.K. Jobs Update In Focus

By Carla Mozee, MarketWatchFeaturesDow Jones Newswires

Interest rate increase expected from U.S. Federal Reserve

U.K. stocks searched for direction Wednesday, with the blue-chip index hovering around its highest level in more than a month.

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Traders appeared to be holding off ahead of a monthly update on U.K. jobs and wages, which could give the market some impetus.

How markets moved: The FTSE 100 index was up 2 points at 7,502.26 after dipping into the red at the open of trading. Financial, consumer services and basic materials shares were higher, but that move was mostly offset by losses in the utility, industrial, consumer goods, and oil and gas groups. On Tuesday, the index rose 0.6% (http://www.marketwatch.com/story/ftse-100-fights-for-firm-direction-as-inflation-hits-highest-in-almost-6-years-2017-12-12) to mark its highest close since Nov. 8. and a third straight win.

The pound bought $1.3325, up from $1.3317 in New York late Tuesday.

In the fixed-income market, the 10-year gilt yield was down 1 basis point at 1.210%, according to Tradeweb. Yields fall when prices rise.

What's moving markets: In focus is a report on the British labor market, scheduled for release by the Office for National Statistics. The wages data is closely tracked by the Bank of England, which will give its latest monetary policy update on Thursday.

The October unemployment rate is expected at to come in at 4.2%, according to a FactSet poll of analysts. The rate currently stands at 4.3%. Wages adjusted for inflation have been falling, with September marking the seventh straight month of pay under pressure.

Analysts see wages as likely to remain under pressure, which would underscore concerns about how British consumers' spending is holding up at a time of lower earnings and higher prices. On Tuesday, the ONS said annual consumer price inflation hit 3.1% in November (http://www.marketwatch.com/story/uk-inflation-hits-almost-6-year-high-2017-12-12), as rising airfares helped push the rate its highest level since March 2012.

The ONS employment figures are due at 9:30 a.m. London time, or 4:30 a.m. Eastern Time.

Central banks in focus: The U.S. Federal Reserve releases its monetary policy decision Wednesday, with markets essentially pricing in an announcement of a quarter-percentage-point interest-rate hike.

Outgoing Fed Chairwoman Janet Yellen will hold a press conference at the conclusion of the bank's two-day meeting, and investors will look for hints on the future pace of rate increases. The decision is due at 7:00 p.m. London time, or 2 p.m. Eastern. Yellen is scheduled to speak at 2:30 p.m. Eastern.

Traders will assess today's U.K. data in the light of the Bank of England's minutes and monetary policy decision, scheduled for release on Thursday.

See:What analysts are looking for in Thursday's Bank of England meeting (http://www.marketwatch.com/story/what-analysts-are-looking-for-in-thursdays-bank-of-england-meeting-2017-12-12)

BOE Gov. Mark Carney and his colleagues in November raised the benchmark interest rate for the first time in a decade, by a quarter percentage point, to 0.5%. Policy makers have signaled rates could be raised by that same pace two more times over the next three years.

Stock movers: Dixons Carphone PLC (DC.LN) shares shot up 7.9% as the electronics retailer said it logged record Black Friday sales (http://www.marketwatch.com/story/dixons-carphone-tackling-mobiles-unit-performance-2017-12-13) and that it's working on addressing issues at its mobile division.

"We believe that we can, over time, reduce the complexity and capital intensity of our mobile business model, and increase the simplicity and profitability of what we do," said Chief Executive Seb James.

TUI AG rose 1.9%, with the travel services company saying underlying earnings before interest, taxes and amortization, or Ebita, grew 12% to EUR1.12 billion in fiscal 2017 (http://www.marketwatch.com/story/tuis-2017-profit-falls-extends-growth-guidance-2017-12-13).

Home builders were among decliners, with Barratt Developments PLC (BDEV.LN) down 1.4% and Persimmon PLC (PSN.LN) off 1%.

(END) Dow Jones Newswires

December 13, 2017 04:36 ET (09:36 GMT)