12th Jan 2015 06:58
LONDON (Alliance News) - London stocks are set to open lower Monday as investors digest December's mixed US jobs report which saw another month of strong employment gains and an upward revision to November's figures but a slowdown in wage growth.
The Labor Department's closely watched jobs report said US employment increased by 252,000 jobs in December after jumping by an upwardly revised 353,000 jobs in November, helping to push the unemployment rate down to 5.6% in December from 5.8% in November. Economists had forecast a rise of 245,000 jobs and a dip in the unemployment rate to 5.7%.
While the upbeat data suggest that the Federal Reserve will consider raising interest rates in the near future, the report also showed a slowdown in annual wage growth to 1.7% in December from 2.0% in November to record the slowest rate of growth since January of 2012.
"The market reaction was anything but positive as European markets and US markets slid back sharply, to finish a turbulent week in negative territory, albeit well off their lows, and this uncertainty looks set to weigh on the markets this morning as we start a new week with further softness in the oil price," says Michael Hewson at CMC Markets.
The FTSE 100 called to open 14 points lower at 6,487, down from Friday's close of 6,501.14 which contributed to a fall on the week of 1%. The DJIA closed Friday down 1% at 17,737.37.
Brent crude is trading below USD50 a barrel again, quoted at around USD49.07 a barrel early Monday and US benchmark West Texas Intermediate was quoted at USD47.30.
In a light corporate calendar, Taylor Wimpey and AO World release trading statements. Shire shares will gain some attention after the pharmaceutical company on Sunday said it has agreed to acquire the US's NPS Pharmaceuticals Inc for USD46.00 per share in cash, in a deal worth a total of USD5.2 billion.
No economic data are scheduled for release.
Japan is closed for Coming of Age Day. The Hang Seng in Hong Kong is up 0.2% at 23,978.07 and the Shanghai Composite is down 1.9% at 3,222.389.
By Ian Edmondson; [email protected]
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