(Alliance News) -Â London stocks lost steam as Friday's session progressed with jitters setting in ahead of a key US labour market update.
"The US central bank has been adamant about needing confirmations of an improving job market and today's report could seal the deal for the bank to announce upcoming QE tapering in the next meeting that will be held in November," said Walid Koudmani, market analyst at XTB.
Analysts have pencilled in 488,000 new jobs in September, according to FXStreet, up from 235,000 in August. A disappointment could heighten fears of stagflation - when economic growth stalls even as prices rise. A better-than-forecast result could cement expectations that the US Federal Reserve will announce the start of tapering of its quantitative easing programme after its November 2 and 3 policy meeting.
The monthly US jobs report for September is out at 1330 BST.
The FTSE 100 index was up just 0.15 point at 7,078.19 midday Friday. The mid-cap FTSE 250 index was up 18.10 points or 0.1%, at 22,577.32. The AIM All-Share index was up 2.79 points, or 0.2%, at 1,212.41.
The Cboe UK 100 index was down 0.1% at 703.30. The Cboe 250 was up 0.1% at 20,399.52, and the Cboe Small Companies up 0.4% at 15,418.31.
In mainland Europe, the CAC 40 in Paris was down 0.4%, while the DAX 40 in Frankfurt was down 0.1%.
European stocks were trading cautiously ahead of the US jobs data, while Wall Street was on track for a tepid open. The Dow Jones was called up 0.1% and the S&P 500 and Nasdaq Composite both flat.
The dollar, meanwhile, was treading water. Sterling was quoted at USD1.3629 midday Friday, flat against USD1.3625 at the London equities close on Thursday.
"The dollar is helped by this morning's soft German export data and the relative trend in eurozone versus US data overall," said Kit Juckes at Societe Generale.
The euro traded at USD1.1564, flat from USD1.1566 late Thursday after data on Friday showed Germany's trade surplus declined both annually and monthly in August.
Europe's largest economy registered a trade surplus of EUR13.0 billion in August, fading 27% from EUR17.7 billion in July and also 14% below the EUR15.1 billion from a year earlier. In addition, the EUR13.0 billion surplus missed FXStreet cited consensus of EUR15.8 billion, which would have been an annual hike.
Against the yen, the dollar rose to JPY111.83 from JPY111.45.
Gold was quoted at USD1,759.67 an ounce, flat versus USD1,759.45 on Thursday.
In London, travel firms were helping to buoy the FTSE 100.
British Airways parent International Consolidated Airlines rose 1.7% on a further relaxation of UK travel rules. A total of 47 countries including South Africa, Mexico and Thailand will be removed from England's red list on Monday, UK Transport Secretary Grant Shapps announced on Thursday.
Travellers arriving from those destinations will no longer need to spend 11 nights in a quarantine hotel at a cost of GBP2,285 for solo travellers. Just seven countries will remain on the red list following the changes - Colombia, Dominican Republic, Ecuador, Haiti, Panama, Peru and Venezuela.
The countries removed from the red list primarily are long-haul destinations. Shares in budget operators easyJet and Ryanair were up 1.3% and down 0.7%, respectively. Jet engine maker Rolls-Royce was up 1.1%.
Not doing as well, shares in package holiday operator Tui were down 14%, the company having announced a EUR1.1 billion rights issue on Wednesday.
While oil prices remained elevated, gains for London's oil majors moderated as the session progressed. Shares in Royal Dutch Shell 'A' and 'B' were up 0.4% and 0.8% at midday, while BP was up 0.9%.
Brent oil was trading at USD82.69 a barrel on Friday, up from USD81.76 late Thursday.
However, oil and gas firms EnQuest and Tullow Oil rallied 5.2% and 3.0% respectively, after both getting upgraded to Buy from Hold at Jefferies.
In the FTSE 250, Weir fell 3.1% after late Thursday saying it continued to see strong demand across its markets in the third quarter, but the engineer fell victim to an attempted cyber attack which led to significant temporary disruption.
The Glasgow-based firm said the attack did not have a detrimental effect on orders but third-quarter profitability was hurt with revenue deferrals on shipment delays and under-recoveries.
As such, Weir expects operating profit for financial 2021 to drop by between GBP10 million and GBP20 million as a result of the attack and profit before tax and amortisation is now expected to be in the range of GBP230 million to GBP245 million. It posted pretax profit from continuing operations of GBP255.4 million in financial 2020.
Unite Group was down 2.7% after the student accommodation firm warned that full-year earnings per share will be at the lower end of guidance due to a reduction in occupancy and rental income.
The Bristol, England-based student accommodation firm said 94% of bed spaces are now let across its total portfolio as the lettings cycle for the 2021-22 academic year enters the final stages. This is up from 88% the year before but down from 98% two years ago - and below management expectations for 95% to 98% occupancy.
Unite warned that it expects 2021 earnings per share of around 27 pence to 30p, at the lower end of guidance.
By Lucy Heming;Â lucyheming@alliancenews.com
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