London close: FTSE ends flat as investors mull payrolls report

7th Mar 2025 09:59

(Sharecast News) - London stocks pared earlier losses to close flat on Friday as investors digested a slightly weaker-than-expected non-farm payrolls report amid confusion about Donald Trump's tariff plans.

The FTSE 100 closed flat at 8,679.88.

Figures from the Bureau of Labor Statistics showed the US economy added fewer jobs than expected in February.

Non-farm payrolls rose by 151,000 following a downwardly-revised 125,000 increase in January. This was below consensus expectations for a 160,000 jump. The biggest drag to employment came from the federal government, which shed 10,000 jobs, while jobs in healthcare, financial services, transport and warehousing grew.

The data also showed that the unemployment rate rose to 4.1% in February from 4% the month before.

Thomas Ryan, North America economist at Capital Economics, said the US labour market is still in "decent shape".

He said the modest rise in non-farm payrolls in February and the 0.1%-point rise in the unemployment rate confirm "the economy started the year soft but is not plummeting towards a recession".

"Some of those fears may resurface in the March Employment Report, when recent federal government layoffs will be a much larger drag on employment than they were last month. But with private-sector hiring still running at a fairly healthy three-month average pace of 169,000, it suggests the labour market can handle it," he said.

Trump's tariffs were still very much in focus, meanwhile, after the US President signed executive actions on Thursday to delay until 2 April tariffs on all products from Mexico and Canada that are covered by the USMCA free trade treaty.

Earlier announced import tariffs of 25% on steel and aluminium are still scheduled to take effect on 12 March.

Russ Mould, investment director at AJ Bell, said: "More uncertainty around tariffs has weighed on global stock markets.

"Even though Donald Trump has made more goods exempt from tariffs on Canada and Mexico, it's the constant tinkering that's upset investors.

"If Trump had stuck to his guns, companies could have planned adjustments accordingly and known the lay of the land. The fact Trump keeps changing his mind confuses matters as companies have no idea what's going on from one day to the next. That also means investors are unsure how to position their portfolios."

On home shores, investors mulled the latest data from mortgage lender Halifax, which showed that house prices unexpectedly dipped in February.

Prices nudged down 0.1% following a 0.6% increase in January, and versus expectations for them to tick up 0.3%. On the year, house prices were up 2.9% in February, unchanged on the previous month.

The average price of a home stood at £298,602, down from £298,815.

Amanda Bryden, head of mortgages at Halifax, said: "February's figures highlight the delicate balance within the UK housing market. While there's been talk of a last minute rush on new mortgages ahead of the changes to stamp duty, inevitably we've seen some of the demand that was brought forward start to fade as the April deadline ticks closer, given the time needed to complete a purchase.

"That may help to explain why growth in first-time buyer property prices eased in February, falling to +2.4%, in contrast to homemover price inflation which accelerated, reaching +3.7%

"While house price growth has slowed overall, market activity remains strong and comparable to pre-pandemic levels, demonstrating a resilience amongst buyers that's been evident in the face of higher borrowing costs.

"While those affordability challenges persist, the ongoing shortage of housing supply coupled with sustained demand suggests property prices will continue to rise this year, albeit at a more measured pace compared to last year."

Also earlier, industry research showed that retail footfall nudged higher in February, although at a far slower rate than seen in January. According to the latest BRC-Sensormatic monitor, footfall increased by 0.2% year-on-year.

The second consecutive monthly increase, it was, however, well below January's 6.6% jump.

Andy Sumpter, EMEA retail consultant at Sensormatic, said: "After January's jump-start, retail footfall stalled, with retailers seeing only the slimmest improvements.

"While the good news is that shopper counts remained steady, many would have been hoping for a more substantial leap, building on a strong start to the year.

"With Easter falling late and well into April this year, this will undoubtedly put added pressure on retailers as we head into March."

In equity markets, Just Group tumbled as it posted full-year pre-tax profit that missed consensus expectations and struck a cautious note on the outlook.

Premier Inn owner Whitbread lost ground after JPMorgan Cazenove downgraded the shares to 'neutral' from 'overweight' "on the back of a fragile UK consumer from lower income demographics".

On the upside, housebuilders gained after the Halifax data, with Taylor Wimpey, Barratt Redrow and Persimmon all up.

Russ Mould said: "Housebuilders seem to be breathing a sigh of relief after the latest UK house price figures. The market has stalled but not slumped as the stamp duty holiday approaches its end.

"While the latest Halifax figures were below expectations, they were hardly a disaster. While the tailwind as people rushed to beat the deadline has now played out, the country's supply and demand dynamics can continue to support property prices.

"A fragile recovery in the housebuilding space needs support from a resilient market as the sector contends with pockets of inflation in build costs."

Barratt Redrow was also in focus as it announced that its chief operating officer and deputy chief executive Steven Boyes is planning to retire later this year after nearly five decades of service.

Fresnillo shone as Berenberg upgraded shares of the precious metals miner 'buy' from 'hold' and lifted the price target 1,020p form 840p following full-year results earlier in the week.

Market Movers

FTSE 100 (UKX) 8,679.88 -0.03%

FTSE 250 (MCX) 20,113.65 -0.23%

techMARK (TASX) 4,820.55 -0.47%

FTSE 100 - Risers

BT Group (BT.A) 160.25p 5.15%

Vodafone Group (VOD) 72.50p 4.17%

Taylor Wimpey (TW.) 114.05p 3.49%

Coca-Cola HBC AG (CDI) (CCH) 3,466.00p 3.09%

Barratt Redrow (BTRW) 428.00p 2.98%

JD Sports Fashion (JD.) 77.82p 2.88%

SEGRO (SGRO) 693.40p 2.82%

Kingfisher (KGF) 259.10p 2.70%

Reckitt Benckiser Group (RKT) 5,418.00p 2.34%

LondonMetric Property (LMP) 177.40p 2.25%

FTSE 100 - Fallers

Melrose Industries (MRO) 488.80p -12.15%

Flutter Entertainment (DI) (FLTR) 18,855.00p -6.52%

CRH (CDI) (CRH) 7,414.00p -5.87%

Smurfit Westrock (DI) (SWR) 3,531.00p -4.95%

Schroders (SDR) 407.40p -4.86%

BAE Systems (BA.) 1,566.50p -4.10%

Anglo American (AAL) 2,381.50p -3.29%

Barclays (BARC) 298.75p -3.13%

Glencore (GLEN) 319.15p -2.55%

Scottish Mortgage Inv Trust (SMT) 974.60p -2.54%

FTSE 250 - Risers

Oxford Nanopore Technologies (ONT) 102.00p 9.80%

Urban Logistics Reit (SHED) 124.00p 6.90%

Greggs (GRG) 1,848.00p 4.88%

Foresight Group Holdings Limited NPV (FSG) 386.00p 3.49%

ITV (ITV) 78.80p 3.21%

Supermarket Income Reit (SUPR) 71.50p 3.17%

Bellway (BWY) 2,288.00p 3.16%

Workspace Group (WKP) 422.50p 2.92%

Empiric Student Property (ESP) 81.90p 2.89%

Quilter (QLT) 157.50p 2.87%

FTSE 250 - Fallers

Just Group (JUST) 149.40p -8.46%

Burberry Group (BRBY) 997.60p -6.77%

Spire Healthcare Group (SPI) 177.00p -6.15%

Babcock International Group (BAB) 711.00p -5.26%

Carnival (CCL) 1,450.00p -5.14%

Dr. Martens (DOCS) 58.10p -4.83%

RHI Magnesita N.V. (DI) (RHIM) 3,640.00p -4.21%

Ferrexpo (FXPO) 75.60p -4.18%

Baillie Gifford US Growth Trust (USA) 230.00p -4.17%

Indivior (INDV) 734.00p -3.67%