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London pre-open: Stocks seen higher after Wall St gains; unemployment rate rises

By Michele Maatouk

Date: Tuesday 13 Oct 2020

London pre-open: Stocks seen higher after Wall St gains; unemployment rate rises

(Sharecast News) - London stocks were expected to rise at the open on Tuesday following a strong session on Wall Street, although the latest UK unemployment figures could put a dampener on things.
The FTSE 100 was called to open 19 points higher at 6,020.

Figures released earlier by the Office for National Statistics showed the unemployment rate rose to 4.5% in August from 4.1% in July, coming in above consensus expectations of 4.3%. This marked the highest level in more than three years.

Pantheon Macroeconomics said: "Looking ahead, it remains likely that job losses will accumulate in October, ahead of the wind-down of the Coronavirus Job Retention Scheme at the end of the month. The ONS' Business Impact of Covid-19 found that 9.4% of employees still were on the furlough scheme in the two weeks to September 20.

"The successor scheme, the Job Support Scheme, will do little to hold back the tide of redundancies, as it requires firms to make up one-third of the shortfall in pay of any former full-time workers that they employ on a part-time basis, so that the employee also receives a wage contribution from the government."

In corporate news, SSE said it had agreed to sell its 50% share in its Multifuel energy-from-waste ventures to Australian fund manager First Sentier Investors for £995m in cash as part of its £2bn disposal programme.

The transaction is expected to complete by late 2020 subject to antitrust approval by the European Commission, SSE said on Monday.

Cash from the disposals will support the company's plans to invest £7.5bn in low-carbon energy infrastructure over the next five years and reduce SSE's net debt, it added.



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