Pearson shares soar; M&S names new chairman
U.K. stocks advanced Friday, as oil prices came fighting back from heavy losses, and as a stronger-than-expected jobs report from the U.S. supported expectations for continued growth in the world's largest economy.
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The FTSE 100 index was up 0.3% at 7,272.80. The London benchmark had opened with a loss, pulled down by a decline for oil shares as crude prices fell nearly 1%.
Shares of airlines were on the rise after financial updates, and Pearson PLC's stock surged after the publisher revealed the latest moves in its restructuring.
See:European airlines take off after upbeat IAG, easyJet numbers (http://www.marketwatch.com/story/no-pr-disasters-here-european-airlines-take-off-after-upbeat-iag-easyjet-numbers-2017-05-05)
Equities held to higher ground after the U.S. Labor Department said 211,000 people found new jobs in April after a slow start in hiring during early spring. Wages grew, but at a slower pace than late last year.
"Investors are more likely to believe the [Federal Reserve's] stance that the weakness in the economic data is only transitory," said Naeem Aslam, chief market analyst at Think Markets, in a note. "The jobs market is healthy and in order for this to become even healthier, we need to see the real wage number to continue to improve."
Traders appeared "a little underwhelmed" by the wage component, wrote Craig Erlam, senior market analyst at Oanda. Following the report, the pound was higher against the dollar, buying $1.2940 compared with $1.2924 late Thursday.
A stronger pound can clip shares of FTSE 100-listed multinational companies that make the bulk of their earnings and revenue overseas.
"The reality is that today's report, containing both positive and negative aspects, is unlikely to have altered the Fed's plans and a June hike very much remains on the table," wrote Erlam.
As the Fed is poised to raise rates again, the Bank of England next Thursday is likely to stand pat when it delivers its rate decision. The BOE's key rate stands at 0.25%.
For the week, which was shortened by Monday's Bank Holiday, the FTSE 100 was on course for a 0.9% increase.
Oil rollercoaster: Oil prices this week fell to their lowest since late November, hit by expectations for a recovery in Libyan crude production and a rise in U.S. output. They swung between gains and losses Friday, but were off session lows.
In London, shares in oil producer BP PLC (BP.LN) (BP.LN) were up 0.8% after losing more than 1% at the start of the session. Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) flipped higher, trading up by 1.8%. The oil group makes up 14% of the FTSE 100's weighting.
Read:OPEC faces high-stakes decision as oil drops for the week (http://www.marketwatch.com/story/opec-faces-high-stakes-decision-as-oil-drops-to-5-month-low-2017-05-04)
U.S. oil futures were still facing a roughly 7% slide for the week, while Brent was on track for a nearly 6% fall.
Metal decline: Metals prices have also been pummeled this week, with analysts saying Chinese demand concerns (http://www.marketwatch.com/story/chinese-metals-prices-slide-on-demand-fears-2017-05-04) have been a source of pressure for the metals complex.
But shares of miners turned higher as metals prices caught a break from heavy selling.
Glencore PLC (GLEN.LN) moved up 1.5%, Antofagasta PLC (ANTO.LN) tacked on 1%, and iron ore and copper miner Anglo American PLC (AAL.LN) swung up 0.8%.
Fresnillo PLC (FRES.LN) and Randgold Resources PLC (RRS.LN) were up 2.5% and 2.4%, respectively, as gold futures had been higher earlier. The precious metal was still looking at a nearly 4% weekly decline.
Read: Chinese metals prices slide on demand fears (http://www.marketwatch.com/story/chinese-metals-prices-slide-on-demand-fears-2017-05-04)
Stock movers: Pearson PLC shares (PSON.LN) soared 11% after the education and publishing company said it would launch a review of its struggling U.S. learning-products business (http://www.marketwatch.com/story/pearson-shares-surge-on-us-review-cost-cut-plan-2017-05-05) and announced more cost savings.
International Consolidated Airlines Group SA (IAG.LN) climbed 6.2% after the British Airways said first-quarter operating profit rose slightly to 170 million euros (http://www.marketwatch.com/story/iag-profit-edges-higher-on-lower-fuel-costs-2017-05-05). The company also stuck to its outlook for an improvement in operating profit this year.
Shares of EasyJet PLC (EZJ.LN) gained 5.2% after the company posted an 11.7% rise in passenger numbers in April.
Smith & Nephew PLC (SN.LN) rose 2.8% after the medical devices maker backed its full-year outlook (http://www.marketwatch.com/story/smith-nephew-revenue-unchanged-2017-05-05) even as first-quarter revenue was flat.
Marks & Spencer Group PLC (MKS.LN) popped up 4.9% after the department-store operator named Archie Norman as its new chairman (http://www.marketwatch.com/story/marks-spencer-names-norman-as-non-exec-chairman-2017-05-05), with effect from Sept. 1. Norman has served as the chief executive of Asda, which is Wal-Mart Stores Inc.'s (WMT) British arm.
French vote: Also in focus for investors is Sunday's presidential election in France (http://www.marketwatch.com/story/brace-for-market-mayhem-if-le-pen-unexpectedly-wins-french-presidency-2017-05-04). Independent centrist Emmanuel Macron, who's favored in the markets, is expected to win against far-right euroskeptic Marine Le Pen.
See: Brace for market mayhem if Le Pen unexpectedly wins French presidency (http://www.marketwatch.com/story/brace-for-market-mayhem-if-le-pen-unexpectedly-wins-french-presidency-2017-05-04)
Also: European shares are a buy -- but watch for this Trump risk: Eaton Vance (http://www.marketwatch.com/story/european-equities-a-buy-but-trump-policy-inaction-a-risk-eaton-vance-2017-05-03)
(END) Dow Jones Newswires
May 05, 2017 10:07 ET (14:07 GMT)