Market overview: FTSE closes up 42 at 6,090



LONDON (ShareCast) - 1630:Close The Footsie ended the day with decent gains, led by BP (LSE: BP.L - news) , with traders feeling upbeat following news that US employers added 155,000 jobs in December. In UK economic news it was revealed that the number of home buyers getting mortgages rose for the fifth month in a row in November (Xetra: A0Z24E - news) , hitting a 10-month high, according to the Bank of England. Mortgage approvals reached 54,036 in November, up from 53,071 in October. It was also reported that the UK's dominant service sector saw activity drop for the first time in two years in December as new business tailed off. The latest figures increase the likelihood that the UK could slide into a 'triple dip' recession. The FTSE closed up 42 points at 6,090.

1500: US ISM service sector purchasing managers´ index for the month of December has come in at 56.1, versus 54.7 for the month before (Consensus: 54.2). US factory orders remained flat in November versus the previous month (Consensus: 0.4 per cent).

1441: US stock markets have opened flat as investors react to the broadly in-line jobs data. The Dow and S&P are up 0.01 per cent and 0.05 per cent, respectively, while the Nasdaq is down 0.16 per cent. According to analyst Peter Newland from Barclays Research: 'A solid gain in average hourly earnings and the workweek add to the positive elements but, all in all, the release provides no reason for us or policymakers to shift the view of the outlook.' Citigroup (NYSE: C - news) is making gains Stateside after Goldman Sachs (NYSE: GS-PB - news) upgraded the stock to 'conviction buy'.

1330: US non-farm payrolls increased by 155,000 in December (Consensus: 152,000). The previous month´s data was revised up slightly. More notably, earnings per hour came in quite a bit better than expected.

1320: The FTSE has risen into positive territory, up five points at 6,053. led by BP, which rose early on following news the company which loaned it the Deepwater Horizon rig back in 2010 had agreed a 1.4bn dollar settlement for the part it played in the gulf of Mexico oil spill that followed the fatal explosion of the rig. Speaking of Transocean (NYSE: RIG - news) 's settlement, BP said: 'In settling, Transocean has acknowledged that it played a significant role and has responsibility for the accident. Transocean is finally starting, more than two-and-a-half years after the accident, to do its part for the Gulf Coast.' Meanhwhile, miners continued to lead the downside, with Fresnillo (Other OTC: FNLPF - news) taking the biggest hit.

1217: Citi has pushed back its forecast for the first increase in the Bank of England´s main lending rate to mid-2017, from mid-2016 before. FTSE 100 (FTSE: ^FTSE - news) down 5 to 6,042.

1215: The rate of [analyst] profit estimate downgrades has slowed for a third consecutive month for UK equities (revenues have been responsible for the bulk of the downgrades, with margins instead holding up reasonably well, thanks to structural supports and a lack of new investment), UBS (Berlin: UBRA.BE - news) writes this morning. "Current analyst estimates look too optimistic, in our view. Consensus bottom-up expectations stand at 8 per cent growth for this year, followed by 10 per cent in 2014. From a top-down perspective, we expect 3 per cent growth this year and 7 per cent next, but expect the rate of downgrades to continue to slow, given the recent uptick in macro data, which should be supportive for equities," the broker adds.

1138: Nomura has lowered its forecasts for High Street retailer Marks & Spencer (Other OTC: MAKSY - news) (M&S) ahead of the group's third-quarter trading update (January 10th), but has retained its 'buy' rating and 420p target price for the stock. Based on recent Kantar market data points and comparatives, the broker expects M&S to report a UK retail like-for-like (LFL) sales decline of 1.4 per cent in the third quarter. Nomura foresees a large drop in clothing sales but a robust performance in food.

1026: UBS has this morning downgraded its view on Fresnillo. In its analysts´ own words: "[we are] downgrading Fresnillo (FRES) from Buy to Neutral as a result of recent share price appreciation. Since September 10th, 2012, FRES is up 7 per cent versus silver down 9 per cent and our average silver stock under coverage down 2 per cent. We believe this outperformance was driven by increased investor appetite for high-quality assets (which FRES offers). FTSE 100 down 5 to 6,042.

0930: The UK service sector purchasing managers´ index (PMI) for the month of December fell to 48.9, after a reading of 50.2 for the previous month. Consumer credit increased by 100m pounds (Consensus: 0.0m).

0920: Shares of BP seem to be benefitting from yesterday´s settlement between US outfit Transocean and the US Department of Justice. For Zak Mir, Senior Analyst, Institute of Trading and Portfolio Management: "BP was the missing ingredient in the FTSE 100's December 'Santa Rally', and the reason it could not quite crack 6,000 until the New Year. Now (Other OTC: NWPN - news) the oil giant is likely to hold the key to the UK index maintaining 6000 and perhaps even achieving the ultimate technical goal of a 6,300 target. From now on it will be worth checking to see whether the BP share price can remain above its 200 day moving average at 434p - above which the UK index should be above 6000. The only real word of warning is that historically the oil majors - BP and Royal Dutch Shell (LSE: RDSB.L - news) - tend to be the last to join rallies - moving later (literally like oil tankers that take extended distances to turn around).

0820: As expected, the FTSE has started the session marginally lower, taking its lead from the US, where last night shares ended the session with modest declines following the release of minutes from the Federal Reserve's December policy meeting. During the meeting policy-makers indicated that they believed the bond-purchase programmes would operate until December at the latest. UK company news has been fairly light this morning, but did include power systems giant Rolls-Royce, which is to provide repair and support services for aircraft engines operated by the US Marine Corps and Air Force as part of a contract worth $52.2m. Meanwhile, mining giant Anglo American (LSE: AAL.L - news) announced that it has agreed to sell its 70% interest in the Amapá iron ore mine in Brazil. The FTSE is down three points at 6,045.