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FTSE stalls ahead of NFP report

Prior to this afternoon's US non-farm payroll figures, the FTSE 100’s momentum has slowed as it struggles to stay out of the red.  

City of London
Source: Bloomberg

Considering the gains that equity markets have made over the previous 48 hours, it is no surprise that we are in the process of giving a little back in the morning session.

In contrast, Marks & Spencer is doing the exact opposite having fallen the most in the FTSE yesterday. It now heads the list of highest climbing stocks jumping 2.2% higher in early trading.

Tesco remains one of the talking points in the FTSE, as overnight Moody’s Investors Service downgraded its debt to junk status. However, with a recently agreed £5 billion credit facility the day-to-day running is unlikely to be too badly affected.

There are strange goings-on at Banco Santander as shares have dropped by 10% following the announcement that it was raising €7.5 billion from shareholders. Even though smaller than last year, the company was still planning on paying out €2 billion to those very same shareholders in the form of dividends.

The last few trading days have seen a respite in discussions over Greece and as the gloomy debate has lifted, so too have equity indices levels. This morning’s industrial production levels from both Germany and France have come in slightly weaker than expected, and any hopes of increased eurozone demand in the energy sector have been quashed.

WTI & Brent continue to straddle the $50 a barrel level and appear to be waiting for some fresh oil minister stimulus before making any further moves. 

As ever, the first Friday of the month will see the release of the latest US non-farm payroll figures. A hefty 321,000 jobs were created last month, the first time a figure above 300,000 has been seen since June 2010. It will be interesting to see what revision to those figures are announced.

Wednesday's ADP employment figures are not always the most accurate of indicators but much like the majority of US economic data released of late, they were stronger than expected.

Ahead of the open we expect the Dow Jones to start 55 points higher at 17,426.

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