London open: Stocks rise as bond markets, pound recover some poise; payrolls eyed

London stocks rose in early trade on Thursday as UK bond markets and the pound recovered some poise following a selloff a day earlier after prime minister Keir Starmer failed to back chancellor Rachel Reeves during PMQs.

At 0830 BST, the FTSE 100 was up 0.4% at 8,810.67.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "There’s been a recovery in sentiment for the pound, stocks and UK government debt after scenes in Parliament roiled markets.

"A Chancellor in tears, a backbench revolt, and signs investors are becoming more risk averse to the UK is hardly the way the Prime Minister wanted to mark his first year in office. The government is in repair mode, with Keir Starmer backing Rachel Reeves to remain Chancellor into the next election and beyond. This is helping restore some calm on bond and currency markets, given that investors need stability and certainty to have the confidence to invest in UK assets.

"It’s been a positive start for the Footsie, with investors shrugging off yesterday’s turmoil. Gilt yields, which indicate UK government borrowing costs, have been dipping back from the sharp gains yesterday, while the pound has also regained some strength. Sterling is still lower against the dollar compared to 24 hours ago, having reached multi-year highs earlier this week. But it is still up 1.5% on a fortnight ago, and around 12% since the start of the year."

Looking ahead to the rest of the day, all eyes will be on the non-farm payrolls report, unemployment rate and average earnings for June.

Stephen Innes, managing partner at SPI Asset Management, said: "Economists are pencilling in 110,000 jobs for June - the softest in four months - alongside a mild uptick in the unemployment rate to 4.3%. Wednesday’s ADP already cracked the surface, showing the first drop in private payrolls in over two years. And while Powell keeps insisting the labour market remains ‘solid’, the Fed’s been hiding behind that strength to justify its inaction.

"But if that support starts to wobble - if NFP underwhelms again - the market won’t wait. Rate-cut odds will surge, and equity bulls will treat it like a starter pistol. The Fed may be trying to hold the line, but one weak print could be enough to tip them - and send stocks into another FOMO-fuelled dash higher."

In equity markets, housebuilders were among the top performers, with Persimmon, Taylor Wimpey and Berkeley all up.

Electricals and tech retailer Currys surged as it resumed dividend payments following a spike in annual sales and profits. The FTSE 250 firm said group revenues rose 3% in the year to 3 May, to £8.7bn, or by 2% on a like-for-like basis.

Within that, sales in the UK and Ireland were 4% stronger on an underlying basis, and flat in the Nordics.

Great Portland Estates rallied as it reported a strong start to the year in a first-quarter update.

On the downside, Baltic Classifieds tumbled after full-year results, while Watches of Switzerland slumped as it reported a fall in annual profits but posted record revenue as the UK returned to growth driven by domestic buyers.

Pre-tax profit for the year to 27 April fell 18% to £76m, while revenue grew 7% to £1.65bn. WoS said it was still too early to comment on the potential impact of any US tariff changes.

Market Movers

FTSE 100 (UKX) 8,810.67 0.41%
FTSE 250 (MCX) 21,560.76 0.50%
techMARK (TASX) 5,079.52 0.36%

FTSE 100 - Risers

Persimmon (PSN) 1,235.50p 2.07%
Croda International (CRDA) 3,055.00p 1.80%
Marks & Spencer Group (MKS) 344.10p 1.71%
Taylor Wimpey (TW.) 115.15p 1.63%
SEGRO (SGRO) 676.80p 1.62%
Unite Group (UTG) 826.50p 1.60%
Berkeley Group Holdings (The) (BKG) 3,656.00p 1.56%
Lloyds Banking Group (LLOY) 74.68p 1.55%
Sainsbury (J) (SBRY) 281.00p 1.52%
British American Tobacco (BATS) 3,515.00p 1.47%

FTSE 100 - Fallers

GSK (GSK) 1,401.50p -0.57%
HSBC Holdings (HSBA) 881.80p -0.40%
Beazley (BEZ) 897.00p -0.39%
3i Group (III) 4,038.00p -0.30%
F&C Investment Trust (FCIT) 1,119.00p -0.27%
Next (NXT) 11,960.00p -0.25%
Rio Tinto (RIO) 4,372.00p -0.21%
Melrose Industries (MRO) 530.00p -0.19%
Rolls-Royce Holdings (RR.) 941.80p -0.17%
Centrica (CNA) 158.20p -0.09%

FTSE 250 - Risers

Currys (CURY) 125.40p 5.82%
PRS Reit (The) (PRSR) 111.20p 4.32%
Close Brothers Group (CBG) 385.00p 3.49%
Greggs (GRG) 1,731.00p 3.34%
Wetherspoon (J.D.) (JDW) 795.00p 3.31%
Bytes Technology Group (BYIT) 351.20p 2.81%
Rank Group (RNK) 139.80p 2.79%
Vistry Group (VTY) 634.20p 2.62%
Morgan Advanced Materials (MGAM) 226.00p 2.49%
Bodycote (BOY) 601.50p 2.38%

FTSE 250 - Fallers

Baltic Classifieds Group (BCG) 305.50p -13.58%
Watches of Switzerland Group (WOSG) 401.80p -4.70%
Workspace Group (WKP) 392.50p -3.80%
W.A.G Payment Solutions (WPS) 84.60p -3.42%
Keller Group (KLR) 1,388.00p -3.21%
Ashmore Group (ASHM) 152.70p -2.74%
Frasers Group (FRAS) 668.00p -2.55%
SDCL Efficiency Income Trust (SEIT) 54.60p -2.50%
FirstGroup (FGP) 223.80p -1.84%
Kainos Group (KNOS) 711.00p -1.80%