UKX FTSE 100 Index

By Carla Mozee, MarketWatch

Pound still falls vs. dollar after disappointing U.S. jobs data

U.K. stocks swung higher Friday, aided by strengthening among commodity shares, but the British blue-chips benchmark still marked its worst week in roughly three months.

The FTSE 100 edged up 0.1% to close at 6,125.70.

But for the holiday-shortened week, the index fell 1.9%. That marked a third consecutive weekly loss, and the largest such pullback since the week ended Feb. 12, according to FactSet.

Stocks spent much of Friday's session in the red ahead of closely watched U.S. jobs data. Eventually, the report showed in April, 160,000 new jobs were created (http://www.marketwatch.com/story/us-gains-160000-jobs-in-april-2016-05-06). Economists polled by MarketWatch had expected 203,000 nonfarm jobs. The unemployment rate was unchanged at 5%.

"The non-farm payrolls farm across the Atlantic fell significantly short of expectations and although this might not be great news for the U.S. economy, it certainly makes justifying that next rate increase from the Federal Reserve that much harder," said Tony Cross, market analyst at Trustnet Direct, in a note.

That data were "bringing about the usual air of uncertainty which has helped propel precious metals miners higher through the session," he said.

Shares of Randgold Resources PLC (RRS.LN) vaulted to the top of the FTSE 100, rising 6.6% as gold prices popped up nearly 2%. Precious metals miner Fresnillo PLC (FRES.LN) tacked on 6.2%.

Rio Tinto PLC (RIO) (RIO) (RIO) shares picked up 0.9% as the company said it's headed toward the next stage of development at the Oyu Tolgoi copper and gold mine in Mongolia. (http://www.marketwatch.com/story/rio-tinto-progresses-on-mongolia-mine-2016-05-06)

Meanwhile, major oil companies BP PLC (BP.LN) (BP.LN) and Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) rose 0.7% and 1%, respectively, as oil prices turned higher.

Oil futures gained on concerns about disruptions to global crude output, with a wildfire raging in oil-rich regions of Canada and as a Chevron-operated offshore oil facility in southern Nigeria was attacked.

But among decliners, Inmarsat PLC (ISAT.LN) shares sank 5.9%, building on Thursday's 7.2% slide after the satellite company cut its full-year sales outlook (http://www.marketwatch.com/story/inmarsat-cuts-revenue-guidance-on-energy-slowdown-2016-05-05).

Sterling: The U.S. dollar fell against most rivals after the jobs report, but still gained against the pound. Sterling was down 0.4% at $1.4438.

"The pound is suffering from a few things. U.K. data this week have been poor, with services, construction and manufacturing PMIs all missing expectations and that's showing the cooling effect the referendum is having on the economy already," said James Ruddiman, London-based head of foreign exchange advisory of Audere Solutions.

Ruddiman's referring to a June 23 election asking Britons whether the U.K. should cut membership ties with the European Union, the risk of which has been dubbed Brexit.

Also, the Bank of England's quarterly inflation report is due next Thursday, "and that's likely to be dovish given the data in recent weeks ... and that's another reason to keep the pound down," he said. The Bank of England isn't likely to raise interest rates this year, he added.

Movers: Meanwhile, shares of InterContinental Hotels (IHG) fell 0.5%. The owner of the Holiday Inn Crowne Plaza and other hotel chains said the earlier timing of the Easter holiday "had an adverse impact across the industry, especially in the Americas and Europe, which we expect to reverse in Q2." First-quarter global revenue per room rose 1.5%, said IHG.

IHG had a "slow start to 2016," said analysts at Numis in a note. "In our view, there is increasing evidence that the U.S. hotel industry is close to a cyclical peak and that this may stimulate further consolidation in the sector."

In the mining space, BHP Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU) shares fought off losses to end higher by 1.6%. The mining heavyweight in an early Friday statement said a Brazilian court on Thursday approved a restoration agreement reached in March with some Brazilian authorities over the deadly Samarco dam collapse in November.

Earlier (http://www.marketwatch.com/story/mining-firms-bhp-vale-face-44b-lawsuit-in-brazil-2016-05-03)this week, federal prosecutors in Brazil (http://www.marketwatch.com/story/mining-firms-bhp-vale-face-44b-lawsuit-in-brazil-2016-05-03) filed a civil lawsuit seeking 155 billion reals ($43.84 billion) for cleanup and remediation from BHP and Vale SA (VALE5.BR) (VALE5.BR), which run the Samarco joint venture.

(END) Dow Jones Newswires

May 06, 2016 12:25 ET (16:25 GMT)

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