London open: Stocks gain as UK jobs data cements rate cut expectations
By Michele Maatouk
Date: Thursday 17 Jul 2025
(Sharecast News) - London stocks rose in early trade on Thursday as the latest UK jobs data raised expectations of a rate cut by the Bank of England next month.
At 0835 BST, the FTSE 100 was up 0.3% at 8,953.22.
Figures released earlier by the Office for National Statistics showed the unemployment rate unexpectedly ticked higher in May, while pay growth slowed.
The unemployment rate rose to 4.7% in the three months to May from 4.6% a month earlier, hitting the highest level since early 2021. Economists were expecting the rate to remain unchanged.
Annual growth in employees' average earnings for both regular earnings, which exclude bonuses, and total earnings, which including bonuses, was 5%. That was down from 5.3% and 5.4%, respectively, a month earlier.
The data also showed that the estimated number of vacancies fell by 56,000 on the quarter to 727,000 in April to June. This was the 36th consecutive quarter of falls.
Liz McKeown, director of economic statistics at the ONS, said: "The labour market continues to weaken, with the number of employees on payroll falling again, though revised tax data shows the decline in recent months is less pronounced than previously estimated.
"Pay growth fell again in both cash and real terms, but both measures remain relatively strong by historic standards.
"The number of job vacancies is still falling and has now been dropping continuously for three years."
Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: "UK markets opened higher this morning as the Bank of England has been handed a fresh incentive to cut rates after labour market data showed slowing wages and a rise in unemployment.
"Markets are pricing in two cuts by the end of the year, with 80% of the first cut coming in August. The fallout from hikes to National Insurance and minimum wages has not been as large as once feared. Yesterday's inflation print showed some signs of higher prices, but companies look to be cutting back on hiring as their priority."
In equity markets, Diploma shot to the top of the FTSE 100 as it hailed a "strong" full-year performance, with a full-year upgrade to organic growth of 10% from 8%.
Media group Future was also sharply higher after saying it was on track to meet market expectations for FY25, having traded in line in the third quarter.
Ocado Group surged as it reported a 13% jump in first-half group revenue and a 76.5% increase in adjusted EBITDA.
Technology firm NCC rallied as it confirmed that it is in the early stage of reviewing all strategic options for its cyber business should the sale of its Escode business be agreed.
Homeware retailer Dunelm advanced as it said that full-year profit was set to be in line with consensus expectations as it hailed a "good" fourth-quarter performance.
On the downside, easyJet tanked as the budget airline said that higher fuel costs and a strike by French air traffic controllers would hit full-year profits by around £25m. BA and Iberia owner IAG also lost ground.
Coats Group was in the red as the industrial thread maker raised around £246m in a placing to help fund the acquisition of US insole maker OrthoLite for $770m.
Shares in Mike Ashley's Frasers Group fell after the retail conglomerate's full-year adjusted profits came in at the lower end of the guidance range and domestic sales declined.
Market Movers
FTSE 100 (UKX) 8,953.22 0.30%
FTSE 250 (MCX) 21,667.24 0.30%
techMARK (TASX) 5,165.28 0.38%
FTSE 100 - Risers
Diploma (DPLM) 5,230.00p 6.65%
Ashtead Group (AHT) 4,817.00p 2.95%
Pershing Square Holdings Ltd NPV (PSH) 4,212.00p 2.73%
Intermediate Capital Group (ICG) 2,098.00p 2.64%
Lloyds Banking Group (LLOY) 78.24p 2.41%
CRH (CDI) (CRH) 6,962.00p 2.38%
Standard Chartered (STAN) 1,332.50p 2.19%
Spirax Group (SPX) 6,140.00p 1.99%
IMI (IMI) 2,170.00p 1.69%
Weir Group (WEIR) 2,660.00p 1.68%
FTSE 100 - Fallers
easyJet (EZJ) 491.00p -6.62%
International Consolidated Airlines Group SA (CDI) (IAG) 373.60p -1.81%
Fresnillo (FRES) 1,456.00p -1.09%
Imperial Brands (IMB) 2,897.00p -0.99%
GSK (GSK) 1,410.00p -0.81%
British American Tobacco (BATS) 3,847.00p -0.67%
Admiral Group (ADM) 3,258.00p -0.67%
AstraZeneca (AZN) 10,370.00p -0.63%
Babcock International Group (BAB) 1,063.00p -0.47%
Haleon (HLN) 358.40p -0.44%
FTSE 250 - Risers
Future (FUTR) 794.50p 11.59%
Ocado Group (OCDO) 262.30p 11.38%
NCC Group (NCC) 146.00p 3.11%
Computacenter (CCC) 2,322.00p 2.20%
Victrex plc (VCT) 712.00p 1.86%
Big Yellow Group (BYG) 927.00p 1.76%
JPMorgan American Inv Trust (JAM) 1,054.00p 1.74%
Allianz Technology Trust (ATT) 449.00p 1.70%
Rotork (ROR) 325.80p 1.69%
Dunelm Group (DNLM) 1,160.00p 1.67%
FTSE 250 - Fallers
Coats Group (COA) 76.20p -7.19%
Frasers Group (FRAS) 613.50p -4.88%
Ocean Wilsons Holdings Ltd. (OCN) 1,410.00p -4.73%
Premier Foods (PFD) 184.80p -4.45%
Trainline (TRN) 266.60p -4.10%
Discoverie Group (DSCV) 663.00p -3.91%
AJ Bell (AJB) 506.00p -3.44%
Target Healthcare Reit Ltd (THRL) 97.00p -2.71%
Twentyfour Income Fund Limited Ord Red (TFIF) 110.20p -2.65%
Ninety One (N91) 188.90p -1.61%
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