FTSE closes higher by 0 4 after volatile day as US jobs beat expectations

The FTSE 100 closed higher by 0.4% at 5649 on Friday to finish the week on a positive front as UK stocks edged back ground lost over the last two days of consecutive weakness. The trading day was all about the latest release of US non farm payrolls data and with heightened optimism going into the release of the numbers after Thursday surprisingly strong private jobs data, investors were not disappointed.

On all three fronts, non-farm payrolls, private payrolls and unemployment rate, all consensus expectations were beaten, helping to give stocks a initial boost higher, lifting the FTSE 100 to a high of 5682 within minutes. However, as much of the market had predicted such a strong number, after the initial knee jerk reaction in the market, investors started to use the daily highs to exit positions at higher levels and this triggered a sharp retracement in the FTSE 100 from 5675 to 5630 going into the close.

BurBerry shares topped the FTSE 100 on the day, rising 3.9% on the day and closely followed by similar gains for Petrofac and Amec. On the downside were shares of Man Group, the world’s largest listed hedge fund, which fell a large 8% on the day after a raft of ratings cuts by brokers on the fund management sector.

Next week brings a greater focus on three key themes; the sovereign debt situation with the latest meeting of the famed Merkozy duo, ECB and BoE rate decisions and company earnings, which kick off in the US with Alcoa on Monday.

For now, it’s been a positive start to the new trading year, seeing the FTSE rise 1.4% on the week though certainly with sentiment remaining fairly fragile concerning the major European banks such as UniCredit, it could be a fairly volatile next trading week.