U.K.’s FTSE 100 Retreats as U.S. Employers Add Fewer Jobs

U.K. stocks fell for the first time in five days, trimming the benchmark FTSE 100 Index (UKX)’s weekly advance, after a report showed U.S. employers added fewer jobs in July than forecast.

Royal Bank of Scotland Group Plc sank 3.3 percent after reporting results and naming the head of its U.K. consumer unit as chief executive officer. William Hill Plc (WMH) dropped the most in four years after the bookmaker posted earnings that missed analysts’ projections. International Consolidated Airlines Group SA (IAG) rose to a five-year high as the parent of British Airways reported an operating profit in the second quarter.

The FTSE 100 slid 34.11 points, or 0.5 percent, to 6,647.87 at the close in London. The gauge has still gained 1.4 percent this week as a report showed the U.S. economy, the world’s largest, grew more than projected in the second quarter and the Federal Reserve said it will maintain its bond-buying program.

“The headlines from the report look disappointing,” Stewart Richardson, who helps oversee about $100 million at RMG Wealth Management LLP in London, said by telephone. “It goes slightly against the grain compared with the other U.S. data we saw this week. People are reappraising their positions.”

The volume of shares changing hands in FTSE 100 companies today was 1.8 percent lower than the 30-day average, data compiled by Bloomberg show. The broader FTSE All-Share Index fell 0.4 percent today, while Ireland’s ISEQ Index (ISEQ) increased 0.8 percent, extending the highest level since 2008.

Jobs Data

U.S. employers added a 162,000 workers in July, after hiring a revised 188,000 in the previous month, the Labor Department’s payrolls report showed today. That fell short of the median estimate of 185,000 jobs in a Bloomberg survey. The jobless rate fell to 7.4 percent. Economists had predicted an unemployment rate of 7.5 percent.

The FTSE 100 earlier rose as much as 0.2 percent as U.K. construction growth accelerated to the fastest in three years in July. An index of activity rose to 57 from 51 in June, Markit Economics and the Chartered Institute of Purchasing and Supply said today. Reading above 50 indicate expansion.

Britain’s economy will grow faster than previously forecast as consumers increase spending, according to the National Institute of Economic and Social Research. Gross domestic product will expand 1.2 percent this year and 1.8 percent in 2014, compared with predictions in May of 0.9 percent and 1.5 percent, respectively, the institute said today.

RBS Retreats

RBS (RBS) sank 3.3 percent to 322.5 pence. Britain’s biggest publicly owned lender said Ross McEwan will replace Stephen Hester as CEO on Oct. 1. First-half net income was 535 million pounds ($808 million), compared with a 2 billion-pound loss a year earlier. That missed the 605 million-pound estimate of Mark Phin, an analyst at Keefe, Bruyette & Woods Ltd.

William Hill fell 7.3 percent, the most since August 2009, to 458.5. The operator of more than 2,300 betting shops said first-half pretax profit was 143.6 million pounds, trailing the average analyst estimate of 152.3 million pounds.

Smiths Group Plc (SMIN) tumbled 5.5 percent to 1,320 pence. The U.K. producer of security scanners said talks with a potential buyer for the sale of its medical division have ended after failing to reach an agreement on terms.

IAG jumped 6.7 percent to 317 pence, the highest since February 2008. Profit before one-time items was 245 million euros ($324 million) in the second quarter, compared with a 4 million-euro loss in the year-earlier period.

Weir Gains

Weir Group Plc (WEIR) added 1.6 percent to 2,239 pence, the highest price in almost two months. The U.K.’s largest supplier of pressure pumps was raised to buy from hold at Berenberg Bank.

Inchcape Plc (INCH) surged 9.9 percent to 645 pence, the highest level since June 2008. The largest publicly traded U.K. car retailer and wholesaler reported first-half adjusted pretax earnings increased 11 percent. The company also announced share buybacks of 100 million pounds in the next year.

Man Group Plc advanced 9.5 percent, the most in three months, to 91.5 pence. The world’s biggest publicly traded hedge-fund manager posted first-half earnings that surpassed analysts’ estimates, helped by higher performance fees at its GLG Partners unit.

To contact the reporter on this story: Inyoung Hwang in London at ihwang7@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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