The FTSE has dipped as traders reacted to a sell-off in the US late on Friday following weaker-than-expected jobs figures.
The FTSE dropped 32 points, or 0.5%, to 6,663, following the lead of the S&P 500, which closed down 1.3% on Friday. Last week’s release of US non-farm payroll figures had initially prompted a rally in US equities, before a sell-off on Friday afternoon. The data showed employment rose by 192,000 in March, below market expectation of 200,000.
Mike van Dulken, head of research at Accendo Markets, said the data had clouded the picture over the US Federal Reserve’s next steps in reducing its money printing programme – known as the ‘tapering’ of quantitative easing.
‘Where the report failed to deliver… was in its inability to convince traders/analysts whether the Fed would slow, leave or speed up its programme of QE3 stimulus reduction,’ he said.
Hargreaves Lansdown (HRGV.L) was the biggest faller, dropping 37p, or 2.6% to £13.99. Insurers were also badly hit, with their recovery following the damage inflicted by Budget changes and a regulatory review of pension sales being stopped in its tracks. Legal & General (LGEN.L) was down 5.2p, or 2.4% at 212.5p, Prudential (PRU.L) fell 23p, or 1.7%, at £13.20 and Aviva (AV.L) dropped 6.5p, or 1.3%, to 491.5p.
One of the few stocks to buck the trend was Tesco (TSCO.L), up 2p, or 0.7% at 289.4p, after it mounted a partial recovery following a fall on Friday on the news chief finance officer Laurie Mcllwee was leaving the supermarket group.
Shore Capital analysts Clive Black and Darren Shirley reiterated their ‘sell’ rating for the stock following news of the exit. ‘The departure of Mr Mcllwee is symptomatic in our minds of a business that is not at ease with itself, united in its direction and comfortable within its own skin,’ they said.
‘Those cultural traits are reflected in the operational performance of Tesco in our view, most notably in the UK, its core market, where it has been sustainably and materially under-performing.’