London close: Stocks fall as focus turns to Friday's US jobs report

31st Jan 2013 16:41

Equities were extending losses on Thursday after yesterday's shock contraction in the States, as markets braced for another busy day on the economic calendar tomorrow."Traders were unwinding positions earlier on January's phenomenal rally which sees major share markets at multi-year highs," said market strategist Ishaq Siddiqi from ETX Capital.Market analyst Craig Erlam from Alpari said this afternoon that markets were nervous ahead of the crucial jobs report in the US due out tomorrow afternoon. He said: "The jobs report tomorrow is always one of the most keenly watched items on the economic calendar, with the potential to cause significant movements in a number of markets. The figures over the last couple of months have been pretty uninspiring, as the private sector held off on hiring due to the uncertainty surrounding the fiscal cliff."All of the political infighting did little to ease these concerns, but now a lot of this has been dealt with, especially in respect to taxes, I expect to see the numbers pick up in the first few months of the year. We could even see the first quarter numbers come in much higher than expected, with a backlog of new hires over the past few months being carried out at the start of 2013."Stocks fell yesterday after the US Commerce Department revealed that the world's largest economy shrank by 0.1% in the last three months of last year, a stark contrast to the 3.1% growth seen in the third quarter. Forecasts were for a 1.1% expansion.Meanwhile, economic data from the US today came in mixed: initial jobless claims rose by more than expected last week; personal incomes surpassed forecasts; while the Chicago NAPM purchasing managers' index came in well ahead of estimates. FTSE 100: AstraZeneca hit by falling revenuePharmaceutical titan AstraZeneca dropped after reporting that full-year revenue fell 15 per cent due to a loss of exclusivity on several brands. The company also said that it would not buy back any shares in 2013 "in order to maintain the flexibility to invest the business". Oil giant Royal Dutch Shell was lower after full-year profits slipped slightly as a result of oil price volatility. An analyst at Investec labelled the company's fourth quarter as a "substantial miss". A third-quarter production report from Vedanta disappointed early on but shares climbed firmly into positive territory by the afternoon. The company said that oil and gas output rose 21% and mined metal and silver increased strongly. Petrofac recovered one day after the stock plunged over fears that industry earnings would be lower than expected. Consumer goods giant Diageo was higher after posting profits broadly in line with market expectations. While North American growth was weaker-than-expected and Europe saw continued weakness, this was offset by a strong performance in the Emerging Markets. Broadcaster and broadband group BSkyB gained after beating profit forecasts in the first half, helped by a surge in customer numbers. The firm also hiked its dividend by a fifth.FTSE 250: Lonmin climbs on quarterly production successLonmin, the world's third largest platinum producer, jumped after posting quarterly production ahead of targets despite strikes that hit the South African mining sector last year. Robust festive trading figures for pubs group Mitchells & Butlers saw shares advance this morning; the company reported a 1.0% increase in like-for-like sales in the 14 weeks to January 5th. Sector peer Enterprise Inns suffered heavy falls after Numis downgraded its rating on the stock this morning. 3i climbed after posting a 4.8% increase in net asset value in the three months to December 31st.