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LONDON (Alliance News) - UK stocks opened lower Friday, with investors repositioning ahead of a key jobs report in the US, which could signal the likelihood and timing of a US interest rate hike.
The FTSE 100 index traded down 1.1% at 6,110.05, the FTSE 250 was down 0.95 at 16,927.06 and the AIM All-Share was flat at 734.69.
European stocks also were lower with the French CAC 40 index down 1.1% and the German DAX 30 was down 1.2.%.
In Asia, the Japanese Nikkei 225 closed down 2.2%. Hong Kong returned to trade after a holiday on Thursday and the Hang Seng index traded down 0.4%. Shanghai remained closed to celebrate the 70th anniversary of China's victory over Japan in the Second World War.
The US jobs report, released at 1330 BST, will steal attention as investors, with economists expecting the nonfarm payrolls number to show 220,000 jobs were created in August according to FXStreet.com, slightly higher than the 215,000 in July.
The August jobs reports is seen as particularly important after the US Federal Reserve said in the minutes of its July policy meeting that it "anticipates that it will be appropriate to raise the target range for the federal funds rate when it has seen some further improvement in the US labour market and is reasonably confident that inflation will move back to its 2% objective over the medium term".
"In the view of the markets a weak or strong labour market report might catapult the Fed?s decision in one of two contrasting directions just shortly before the September meeting: no more rate hikes this year or even two at the same time. The third option ? that admittedly would now seem rather dull ? would be just a single rate step. Everything seems possible again," said Commerzbank.
On the London Stock Exchange, Hikma Pharmaceuticals was one of the two gainers in the FTSE 100, up 0.7% at 2,359.00 pence after Goldman Sachs upgraded the stock to Buy from Neutral and raised its price target to 2,840.00p from 2,210.00p.
Aberdeen Asset Management was the other gainer, up 1.8%.
Next traded down 3.0% after Exane BNP downgraded the fashion retailer to Underperform from Neutral and cut its price target to 7,400.00 pence from 7,700.00p. The stock traded at 7,603.50p.
GVC Holdings secured a recommendation for its takeover bid for Bwin.Party Digital Entertainment, leaving the agreement reached by 888 Holdings to merge with Bwin in tatters.
GVC said the Bwin board has agreed to its takeover offer of 25 pence in cash and 0.231 GVC shares per Bwin share, valuing the FTSE 250-listed gaming company at around GBP1.12 billion, or 129.64 pence per share.
GVC said the offer is a 12.5% premium to Bwin's closing share price on Thursday and a 45% premium to the value of Bwin shares on May 14, when GVC and 888 first entered talks to acquire the business.
Bwin confirmed on Friday that it has terminated its agreement with 888.
Bwin was one of the best performers in the FTSE 250, trading up 1.2% at 116.596p. GVC traded down 2.9% and 888 was down 4.7%.
In the economic calendar, the second estimate of eurozone GDP is scheduled for Tuesday next week, rather than Friday.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
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