Source: Sharecast
The FTSE 100 closed down 0.2% at 9,427.73, having hit another record high on Wednesday after a weaker-than-expected US ADP report cemented rate cut expectations.
David Morrison, senior market analyst at Trade Nation, said: "The US government shutdown continues for a second day but has yet to impact financial markets. This is even though government economic data, including today’s weekly unemployment claims and tomorrow's non-farm payroll report won’t be published.
"Yesterday, the monthly ADP private payroll update came in well below expectations, confirming weakness across the labour market that had already been picked up by the last two Bureau of Labor Statistics (BLS) non-farm payroll releases. Investors saw this as increasing the likelihood that the US Federal Reserve will cut interest rates at its next two meetings ahead of year-end."
In equity markets, Tesco was the standout performer on the FTSE 100 as it lifted its full-year guidance after a strong first half fuelled by the warm summer weather.
The supermarket giant said it now expects full-year group adjusted operating profit of between £2.9bn and £3.1bn, up from a previous range of between £2.7bn and £3.0bn.
3i Group rallied following a Bloomberg report the private equity firm is considering exit options, including a possible sale of French IT maintenance provider Evernex. It was understood the sale of Evernex could be valued at €1.2bn to €1.5bn.
The shares were also boosted by an upgrade to ‘buy’ from ‘neutral’ at UBS, which hiked the price target to 4,700p from 4,450p, highlighting sustainable growth at portfolio asset Action.
Morgan Sindall surged as it said 2025 results will be "significantly" ahead of its previous expectations, following a continuation of the strengthening performance from the Fit Out division.
On the downside, Experian tumbled after US analytics software firm Fair Isaac announced the launch of a new program that could make US lenders less reliant on credit agencies.
Fair Isaac said on Wednesday that the ‘FICO® Mortgage Direct License Program’ will eliminate reliance on the three nationwide credit bureaus, giving tri-merge resellers the option to calculate and distribute FICO scores directly to their customers. The news hit shares of Equifax and TransUnion across the pond.
The FICO score is used by lenders to help make credit risk decisions across the customer lifecycle.
SSE fell after saying it expects first-half profits to fall by up to a third, but guided to growth over the full year with the majority of annual earnings being delivered in the second half.
Tate & Lyle was under the cosh for the second day in a row, having fallen sharply on Wednesday after downgrading its full-year profit and revenue expectations.
BT fell after a downgrade to ‘underperform’ at BNPP Exane.
