FTSE 100 claws back some losses as Ukraine tensions ease

• FTSE 100 rises 41 points
• Sentiment boosted by developments in Russia-Ukraine stand-off
• Glencore leads the advance after announcing a big share buyback

UK blue-chips have got off to a positive start, fuelled by hopes that diplomatic efforts to avert a war in Ukraine are paying off.

The FTSE 100 was up 41 points (0.6%) at 7,572, with Glencore PLC (LSE:GLEN) leading the way after a well-received set of full-year results.

READ Glencore to return US$4bn to shareholders as profits soar on record high commodity prices

“There is a certain relief in the Ukraine-Russia crisis as the two sides seem willing to continue their diplomatic efforts to avoid a military action. The latter could help reversing a part of yesterday’s aggressive sell-off in the European markets, and the FTSE 100 could outperform its peers on the back of firm energy and oil prices,” suggested Ipek Ozkardeskaya at Swissquote.

The Office for National Statistics (ONS) reported that the number of UK employees on payrolls rose again in January and is now well above pre-pandemic levels.

The UK employment rate increased by 0.1 percentage points on the quarter to 75.5%, with the ONS estimating that 108,000 people joined the workforce in January, sending the number of people on payrolls up to a record 29.5mln. On the other hand, there are far fewer self-employed people around now.

“Our Labour Force Survey shows the number of people in employment overall is well below where it was before COVID-19 hit. This is because there are now far fewer self-employed people,” said Sam Beckett, the head of economic statistics at the ONS.

“The survey also shows that unemployment has fallen again and is now only fractionally above where it was before the pandemic; however over the same period, nearly 400,000 people, mostly the over-50s, have disengaged from the world of work altogether and are neither working nor looking for a job,” she added.

The unemployment rate decreased by 0.2 percentage points on the quarter to 4.1%, while the economic inactivity rate increased by 0.1 percentage points to 21.2%.

“After taking account of recent rises in consumer prices, real total pay fell in the year to October-December 2021, despite a strong recovery in bonuses,” Beckett noted.

7.55am: Transition of self-employed to wage salve status continues

UK unemployment figures are little changed but wage growth has picked up, according to fresh figures from the Office for National Statistics.

The headline unemployment rate was 4.1% in December and for the three months to December, the ONS revealed, which was in line with economists’ estimates.

Job vacancies hit a record high of nearly 1.3mln, most than 0.5mln above pre-Covid levels.

Average weekly wages, including bonuses, were up 4.3% in December compared to the year before, from 4.2% in November, and above the consensus forecast of 3.8%.

“With the UK jobs market in decent shape, expect another two rate rises from the Bank of England in quick succession,” said economists at ING. 

“But to justify the six further rate rises markets are pricing this year, we need to see signs of a wage-price spiral. We aren’t convinced that’s likely, and policymakers are likely to hike more gradually than investors expect.”

6.45am: Further losses expected

The FTSE 100 is expected to extend its losses after a day of heavy selling across most stock markets at the start of the week. 

London’s blue chip index is seen dropping 12 points on Tuesday after finishing 129 points lower at 7,531.59 the day before – its second biggest one day fall this year.

Overnight on Wall Street, the Dow Jones declined 0.49%, and the S&P 500 index dropped 0.38%, the Russell 2000 dipped 0.46% and the tech-filled Nasdaq remained unchanged.

Across in European Germany’s the DAX fell to an…