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(Alliance News) - Stock prices in London opened higher on Friday morning as investors looked ahead to key economic data out of the US, which may provide hints for the future of rate hikes from the Federal Reserve.
The FTSE 100 index opened up 33.43 points, or 0.4%, at 7,666.88. The FTSE 250 was down 39.33 points, or 0.2%, at 19,424.10, and the AIM All-Share was up 0.99 of a point, or 0.1%, at 844.73.
The Cboe UK 100 was up 0.3% at 767.29, the Cboe UK 250 was down 0.2% at 16,937.09, and the Cboe Small Companies was up 0.2% at 13,441.31.
The US will publish non-farm payrolls at 1330 GMT ahead of an ISM services PMI print at 1500 GMT.
Investors are hoping that the data - which will offer insight into the health of the US labor market - may help provide further hints for the future moves of the US Federal Reserve.
"Stronger-than-expected jobs data will certainly boost inflation expectations, bring the Fed hawks back to the market, send the US yields and the dollar higher, and stocks lower," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
On Thursday, US private employment rose by 235,000 jobs in December, according to figures from payroll firm ADP. The rise in private employment came well above market consensus, as cited by FXStreet, which had expected 150,000 jobs to be added.
For CMC Market's Michael Hewson, another strong jobs print on Friday may offer further basis for the idea that the Fed will raise rates by 50 basis points at the start of February.
In the US on Thursday, Wall Street ended firmly in the red, with the Dow Jones Industrial Average ending down 1.0%, the S&P 500 down 1.2% and the Nasdaq Composite down 1.5%.
In London, Next fell 1.6% after Credit Suisse cut the clothing retailer to 'underperform' from 'neutral'.
On Thursday, the stock closed sharply higher after the firm increased its 2022 pretax profit guidance for the year ending in January 2023 to GBP860 million, from GBP840 million. This would represent growth of 4.5% against the year prior, if achieved.
In the FTSE 250, Clarkson was the best performer in early trade, jumping 8.7%.
The shipping services provider reported strong trading throughout its final quarter, particularly from its Broking division.
As a result, it now expects its results for 2022 to be ahead of market expectations, with underlying pretax profit anticipated at no less than GBP98 million.
Essentra dropped 3.6%, as it reported its business saw a slower period of economic growth in 2022 as a result of toughening market headwinds.
This, coupled with a strong comparative for its final quarter, saw the firm's LFL trading day adjusted sales fall by 3.0% compared with the year prior.
Elsewhere in London, Nanoco soared 62% after the quantum dot developer said that it has agreed a term sheet for a no-fault settlement with Korean electronics firm Samsung.
Nanoco had claimed that Samsung infringed on its unique synthesis and resin capabilities for quantum dots.
Quantum dot technology is used on Samsung QLED televisions. QLED stands for quantum light-emitting diode.
The two firms now have 30 days to agree the terms of a binding agreement. They have jointly requested a stay to the trial that was scheduled on Friday in order to allow time for this agreement to be finalised.
In European equities on Friday, the CAC 40 in Paris was very marginally higher, while the DAX 40 in Frankfurt was slightly lower.
The euro stood at USD1.0528 early on Friday in London, a touch higher against USD1.0525 at the close on Thursday. Against the yen, the dollar was trading at JPY134.17, up compared to JPY133.89.
The pound was quoted at USD1.1909, higher compared to USD1.1890 at the close on Thursday.
According to data from Halifax, the average UK house price fell in December against the prior month, though at a more moderate decline than seen previously.
The average UK house price was GBP281,272 in December, a fall of 1.5% against the previous month. In November, house prices fell by 2.4% to GBP285.425. Against the previous year, house prices grew by 2.0%.
"As we enter 2023, the housing market will continue to be impacted by the wider economic environment and, as buyers and sellers remain cautious, we expect there will be a reduction in both supply and demand overall, with house prices forecast to fall around 8.0% over the course of the year," Halifax commented.
In Asia on Friday, the Japanese Nikkei 225 index closed 0.6% higher as data revealed that the Japanese service sector ended the year with a further expansion in output and order books.
The au Jibun Bank services business activity index rose to 51.5 in December, from 50.3 in November.
Meanwhile, inflationary pressures worsened in the final month of the year, driven by higher labour, fuel, electricity, and raw material prices. The composite purchasing managers' index rose to 49.7 in December, from 48.9 in November.
In China, the Shanghai Composite closed up 0.1%, while the Hang Seng index in Hong Kong was down 0.2% The S&P/ASX 200 in Sydney closed 0.7% higher.
Brent oil was quoted at USD78.51 a barrel at early in London on Friday, up slightly from USD78.48 late Thursday. Gold was quoted at USD1,840.38 an ounce, sharply higher against USD1,828.35.
Still to come on Friday's economic calendar, there's EU consumer confidence at 1000 GMT alongside core and harmonised consumer price prints.
By Heather Rydings, Alliance News senior economics reporter
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