London midday: FTSE extends gains as jobs data cements rate cut expectations
By Michele Maatouk
Date: Thursday 17 Jul 2025
(Sharecast News) - London stocks had extended gains by midday on Thursday as the latest UK jobs data raised expectations of a rate cut by the Bank of England next month.
The FTSE 100 was up 0.5% at 8,970.55.
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, upgrading full-year organic growth guidance to 10% from 8%.
Ocado Group surged as it said its full-year outlook remains on track after swinging to a big profit in the first half, in which both the tech and logistics divisions delivered double-digit top-line increases.
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.
Homeware retailer Dunelm advanced as it said that full-year profit was set to be in line with consensus expectations, hailing a "good" fourth-quarter performance.
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 arm be agreed.
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.
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.
Mr Kipling and Oxo owner Premier Foods was weaker as it said first-quarter sales barely ticked higher, with grocery sales declining as warmer weather impacted some categories.
Market Movers
FTSE 100 (UKX) 8,970.55 0.49%
FTSE 250 (MCX) 21,711.67 0.51%
techMARK (TASX) 5,186.72 0.80%
FTSE 100 - Risers
Diploma (DPLM) 5,260.00p 7.26%
Lloyds Banking Group (LLOY) 78.46p 2.70%
Ashtead Group (AHT) 4,796.00p 2.50%
Airtel Africa (AAF) 190.10p 2.42%
Taylor Wimpey (TW.) 110.15p 2.27%
Whitbread (WTB) 3,087.00p 2.08%
Pershing Square Holdings Ltd NPV (PSH) 4,182.00p 2.00%
IMI (IMI) 2,174.00p 1.87%
Coca-Cola Europacific Partners (DI) (CCEP) 7,130.00p 1.71%
Rentokil Initial (RTO) 346.70p 1.70%
FTSE 100 - Fallers
easyJet (EZJ) 497.50p -5.38%
InterContinental Hotels Group (IHG) 8,542.00p -0.72%
Mondi (MNDI) 1,168.00p -0.68%
Antofagasta (ANTO) 1,824.00p -0.65%
Anglo American (AAL) 2,215.00p -0.45%
Hiscox Limited (DI) (HSX) 1,269.00p -0.39%
St James's Place (STJ) 1,184.00p -0.38%
Aviva (AV.) 631.20p -0.35%
International Consolidated Airlines Group SA (CDI) (IAG) 379.20p -0.34%
Reckitt Benckiser Group (RKT) 4,989.00p -0.34%
FTSE 250 - Risers
Ocado Group (OCDO) 272.90p 15.88%
Future (FUTR) 767.50p 7.79%
Dunelm Group (DNLM) 1,195.00p 4.73%
Aston Martin Lagonda Global Holdings (AML) 76.65p 3.58%
NCC Group (NCC) 146.00p 3.11%
Renishaw (RSW) 2,935.00p 2.98%
Big Yellow Group (BYG) 938.00p 2.96%
QinetiQ Group (QQ.) 498.20p 2.68%
Watches of Switzerland Group (WOSG) 360.40p 2.62%
Marshalls (MSLH) 260.50p 2.56%
FTSE 250 - Fallers
Coats Group (COA) 72.40p -11.81%
Ocean Wilsons Holdings Ltd. (OCN) 1,395.00p -5.74%
Premier Foods (PFD) 187.40p -3.10%
Hochschild Mining (HOC) 261.80p -2.17%
NB Private Equity Partners Ltd. (NBPE) 1,456.00p -1.89%
Trainline (TRN) 272.80p -1.87%
Barr (A.G.) (BAG) 683.00p -1.87%
SSP Group (SSPG) 167.50p -1.82%
RHI Magnesita N.V. (DI) (RHIM) 2,885.00p -1.70%
Endeavour Mining (EDV) 2,194.00p -1.70%
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