London midday: Stocks stay up as investors eye ADP report
By Michele Maatouk
Date: Thursday 04 Sep 2025
(Sharecast News) - London stocks were still firmer by midday on Thursday as investors eyed the latest US ADP report, but airlines were under the cosh after a disappointing update from Jet2.
The FTSE 100 was up 0.2% at 9,194.50.
Russ Mould, investment director at AJ Bell, said: "The FTSE 100 pushed ahead as bond markets calmed down and the focus shifted to US jobs data.
"Ahead of non-farm payrolls on Friday, sharply lower job openings across the Atlantic suggested a weakening in the labour market which could push the Federal Reserve to cut interest rates more aggressively.
"Markets remain twitchy however, and the pressure on Chancellor Rachel Reeves is unlikely to dissipate in any meaningful sense before she delivers her Autumn Budget in late November.
"Airlines were under pressure in London as investors reacted to Jet2's bundle of bad news."
On the UK macro front, a survey showed the downturn in the construction sector continued in August.
The S&P Global construction purchasing managers' index ticked up to 45.5 from 44.3 in July, but remained below the 50.0 mark that separates contraction from expansion for the eighth month in a row. July's reading was the lowest for just over five years.
Civil engineering was the weakest-performing segment, with business activity falling at the fastest pace since October 2020. Survey respondents again commented on a lack of new projects to replace completed work, S&P Global said.
Meanwhile, the drop in output across the house building segment was the sharpest since February.
Tim Moore, economics director at S&P Global Market Intelligence, said: "Construction activity has decreased throughout the year-to-date, which is the longest continuous downturn since early-2020. August data signalled only a partial easing in the speed of decline after output fell at the fastest pace for over five years in July.
"Sharply reduced levels of housing and civil engineering activity were again the main reasons for a weak overall construction sector performance. Commercial work showed some resilience in August, with the downturn the least marked for three months.
"There were some positive signals on the supply side as vendors' delivery times shortened, subcontractor availability improved and purchasing price inflation hit a ten-month low. However, easing supply conditions mostly reflected subdued demand and a lack of new projects.
"Elevated business uncertainty and worries about broader prospects for the UK economy meant that construction sector optimism weakened in August. The proportion of panel members expecting a rise in output over the year ahead was 34%, down from 37% in July and lower than at any time since December 2022."
Looking ahead to the rest of the day, attention will turn to the US, where the ADP report for August is scheduled for release at 1315 BST.
Joshua Mahony at Scope Markets, said: "Markets are gearing up for a fresh batch of economic data out of the US today, with the ADP payrolls release expected to maintain the negative narrative around the jobs market given yesterday's JOLTS job opening figure. The decline in us job openings saw a 176k decline, falling to the lowest level since September 2024 (7.18 million). Notably, the revisions seen over the past month highlight how the ADP payrolls figure has actually been a better guide of the final revised NFP figure than the initial release.
"As such, this provides additional importance to today's ADP figure, with markets expecting to see a decline to the 65k mark."
In equity markets, Lloyds rose following a Financial Times report that thousands of staff at the bank face the sack under plans to get rid of staff the lender deems to be underperforming.
Lloyds was said to be targeting 3,000 people out of its 63,000 workers, with around 50% potentially being axed under an overhaul of performance management led by chief executive Charlie Nunn, who took home more than £5m in pay and bonuses last year.
Electricals retailer Currys shot higher as it hailed a "strong" start to the year, launched a £50m share buyback and reported a 3% jump in group sales in the 17 weeks to 30 August.
Other retailers followed suit, with Next, JD Sports, M&S and B&Q owner Kingfisher also higher.
Genus surged after the animal genetics company reported "substantial strategic progress" over the year to 30 June, as it reported a big jump in profits and revealed a positive update to its joint venture in China.
Building materials distributor and DIY retailer Grafton gained as it held annual guidance and announced a new £25m share buyback after interim profits jumped 19% to £91.5m on the back of a strong contribution from non-UK operations.
On the downside, easyJet, Wizz Air and BA and Iberia owner IAG all flew lower after Jet2 warned that full-year underlying earnings were set to be towards the lower end of the consensus range and cut its winter capacity.
Jet2 said that since its last update on 9 July, the "closer to departure" booking trend has become more pronounced.
Ladbrokes owner Entain was knocked lower by a downgrade to 'hold' at HSBC.
Admiral, Hammerson, Ithaca Energy, Derwent London, Hochschild Mining and Rathbones all fell as they traded without entitlement to the dividend.
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