FTSE 100 back in the black
Non-farm payrolls rose by 313,000 in February, which was the biggest monthly gain since July 2016.
GKN surges after agreeing to combine its Driveline business with Dana Incorporated
The US economy rode like the cavalry to the rescue of UK equities today.
The FTSE 100 index closed at 7,225, up 21 points, having fallen as low as 7,190 at one point.
Engineer GKN PLC (LON:GKN) was among the top blue-chip risers after it announced it had reached an agreement with Dana Incorporated on the proposed combination of the GKN Driveline business with Dana to create Dana PLC.
The proposed transaction values GKN Driveline at a total enterprise value of US$6.1 billion (£4.4 billion); the news sent GKN 3.3% higher to 435.1p, valuing the entire company at £7.5bn.
3.15pm: A robust set of US jobs numbers provided a tonic for the UK
With less than two hours to go, FTSE 100 was back in positive territory, up over 12 points at 7,215.
It comes after a robust set of stats from the US Labor department regarding last month’s job creation figure.
2.35pm: US March hike all but “nailed on”..
Broker MB capital says the US jobs report shows that an interest rate hike in March is virtually a sure thing and it brings the thorny issue of inflation back to the fore
James Ingram, investment manager, said: “With the US economy at virtually full employment, the fear is higher wages will continue to drive inflation, forcing the US Fed to hike interest rates faster and higher than Wall Street would like.
“February’s fall in average wage rise data takes some of the pressure off. But the creation of more than 300,000 jobs in February suggests it will return in the months to come.
“Throw in a potential trade war between the US and the EU and the US economy could be headed for a perfect inflationary storm later this year.
“An interest rate hike in March from the US Fed must now be all but nailed on,” says Ingram.