London pre-open: Stocks seen muted as investors mull jobs data

Pre-open Market Report
06:37, 26th January 2021

(Sharecast News) - London stocks were set for a muted open on Tuesday as investors digest the latest UK jobs data.
The FTSE 100 was called to open just four 4 points higher at 6,642.

Figures released earlier by the Office for National Statistics showed the unemployment rate rose to a four-year high of 5% in November from 4.9% the month before. Still, it was a little better than expectations for a jump to 5.1%.

ONS head of economic statistics Sam Beckett said: "The latest monthly tax figures show that there were over 800,000 fewer employees on payroll in December than last February. More detailed data, published for the first time, show that parts of London have seen the steepest percentage falls, followed by North Eastern Scotland.

"In the three months to November, on our survey data, the employment rate fell sharply again, while the unemployment rate rose to hit 5% for the first time in over four years.

"The number of people saying they had been made redundant in the previous three months remains at a record high. Meanwhile vacancies, which were rising in summer and early autumn, have been falling in the last couple of months."

In corporate news, Rolls-Royce expects £2bn in cash burn this year with widebody engine flying hours falling to 55% of 2019 levels compared with 70% previously forecast as new variants of Covid-19 and enhanced travel restrictions created short-term uncertainty.

The company said it expected to turn cash flow positive "at some point during the second half, reflecting our forecasted profile of flying hours as they recover from today's low base".

Elsewhere, JD Sports Fashion confirmed it is exploring additional funding options with a view to increasing its flexibility "to invest in future strategic opportunities", and said this may involve a non pre-emptive equity placing.

The company was responding to recent press speculation that it was exploring an equity capital raise.

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