The FTSE rose on Friday despite a read on manufacturing which showed a downturn in output had deepened in the UK, while US stocks rose as payrolls data topped estimates.
The S&P Global manufacturing purchasing managers' index (PMI) showed output at a 39-month low of 43.0. Any reading below 50 indicates contraction.
Demand was hit by weaker domestic and export conditions, S&P Global said, citing rising interest rates, the cost-of-living crisis, export losses and concerns about the market outlook.
Meanwhile, purchase prices fell at the quickest pace since January 2016 in August, the data shows.
Manufacturing staffing levels were cut for the eleventh successive month in August. Companies linked lower employment to reduced intakes of new work, falling output volumes and cost control efforts. Excess capacity at factories was also cited by some firms, as backlogs of work contracted to the greatest extent since April 2020.
On Thursday, it was revealed that eurozone inflation remained unchanged month-on-month in August, at 5.3%. European Central Bank president Christine Lagarde hinted at a pause in the rate hike cycle following the release.
The moves came as fresh data showed that US payrolls grew by 187,000 in August, topping estimates.
The number of new jobs added in August was the same as the number of new jobs in July. This shows that the labour market is resilient even with high interest rates and inflation.
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