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(Alliance News) -Â Equities in London tumbled at the open on Wednesday amid a volatile week as traders look ahead to Friday's US nonfarm payrolls reading.
The FTSE 100 index was down 70.65 points, or 1.0%, at 7,006.45 early Wednesday, reversing Tuesday's 0.9% rise.
The mid-cap FTSE 250 index was down 205.16 points, or 0.9%, at 22,525.49 on Wednesday. The AIM All-Share index was down 8.97 points, or 0.7%, at 1,209.23.
The Cboe UK 100 index was down 1.0% at 696.15. The Cboe 250 was down 1.2% at 20,385.71 and the Cboe Small Companies down 0.1% at 15,619.29.
In mainland Europe, the CAC 40 in Paris and the DAX 40 in Frankfurt were both down 1.3% early Wednesday.
After gains on Tuesday, European stocks pulled back as nerves set in before the key end-of-week US labour market report. Ahead of this is ADP's employment report at 1315 BST on Wednesday.
Consensus, according to FXStreet, sees the ADP jobs figure rising to 428,000 in September from 374,000 in August.
"Any weakness in the jobs figure could dampen the market mood again, as soft economic data could no longer revive the central bank doves, as the spike in energy prices continue fuelling expectations of higher inflation for longer. Therefore, central banks will be forced to cool down the overheating in inflation rather than trying to boost recovery," said Ipek Ozkardeskaya, senior analyst at Swissquote.
Brent oil was trading at USD83.20 a barrel early Wednesday, rising from USD82.87 late Tuesday as the commodity continues to push to fresh three-year highs.
Gold was quoted at USD1,751.20 an ounce, soft against USD1,753.55 on Tuesday.
In Tokyo on Wednesday, the Nikkei 225 index closed down 1.1%.
In China, markets in Shanghai remain shut for National Day Golden Week, while the Hang Seng index in Hong Kong was down 0.6% in late trade. Shanghai remains closed on Thursday before reopening on Friday.
The S&P/ASX 200 in Sydney closed down 0.6%.
The dollar edged higher as traders await the key September jobs report.
Sterling was quoted at USD1.3576 early Wednesday, falling from USD1.3630 at the London equities close on Tuesday.
The euro traded at USD1.1571, down from USD1.1600 late Tuesday. Against the yen, the dollar strengthened to JPY111.63 versus JPY111.50.
Besides the ADP jobs report in the US, the economic events calendar on Wednesday has a UK construction PMI reading at 0930 BST and eurozone retail sales at 1000 BST.
Helping the FTSE 100 avoid the steeper losses seen elsewhere in Europe early Wednesday was grocer Tesco, rallying 5.0% after boosting its full-year profit guidance and unveiling plans for a share buyback.
Revenue in the half-year that ended August 28 rose to GBP30.42 billion from GBP28.72 billion year-on-year. It highlighted retail like-for-like sales growth of 2.3% from a year before, and growth of 8.4% when compared with two years ago, a pre-pandemic period.
Adjusted retail operating profit rose to GBP1.39 billion from GBP1.19 billion a year before. Pretax profit soared to GBP1.14 billion from GBP551.0 million.
"We've had a strong six months; sales and profit have grown ahead of expectations, and we've outperformed the market," said Chief Executive Ken Murphy.
The interim performance led the grocer to upgrade its outlook. Tesco now expects full-year adjusted retail operating profit between GBP2.5 billion and GBP2.6 billion. This would be higher than the GBP1.99 billion achieved last year, as well as above the GBP2.33 billion posted for the pandemic-free 2020 financial year.
As well as upping guidance, the supermarket chain unveiled an ongoing share buyback programme, worth GBP500 million in its first tranche which will be carried out until October next year.
Peer J Sainsbury rose 1.1% in a positive read-across.
HSBC shares advanced 1.9% after UBS raised the lender to Buy from Neutral.
Topping the FTSE 250 index was PageGroup, up 6.1% as it lifted its outlook again following growth in the third quarter.
For the three months to the end of September, gross profit jumped 65% year-on-year to GBP228.1 million. Compared to 2019, profit was 13% ahead. Gross profit per fee earner was up 21% on 2019.
"Given the magnitude of the impact of Covid-19 on 2020, we are continuing to compare our results to 2019, our record gross profit year," said Chief Executive Steve Ingham.
Despite uncertainty ahead, driven by Covid-19 and supply chain disruption, the FTSE 250-listed firm said its performance in the third quarter has boosted confidence for the full-year. It now expects annual operating profit in the region of GBP155 million, having previously been seen in a range of GBP125 million to GBP135 million.
HomeServe fell 6.1%. Exane BNP slashed the home emergency repairs firm to Underperform from Outperform.
Lookers rose 6.3% after guiding to full-year underlying pretax profit "materially ahead" of its previous forecasts.
"Trading in Q3 remained strong and above the board's expectations driven by new vehicle market outperformance, excellent new and used vehicle margins and continued tight cost and working capital control," the motor retail and aftersales service company said.
The chip shortage continues to put pressure on the supply and availability of new vehicles, auto dealer Lookers said, leading to robust used vehicle demand as a result. While like-for-like used vehicle sales were down 17% in the quarter against strong year-ago comparatives, this was more than offset by "unprecedented margin retention".
By Lucy Heming;Â lucyheming@alliancenews.com
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