Poor US jobs figures see FTSE struggle to recover

The FTSE 100 made subdued progress as survey data showed far lower than expected jobs growth among US private employers in June.

US employers added a paltry 13,000 jobs last month, compared with a revised gain of 57,000 in May, a report by a payrolls processor showed. Economists had forecast a rise of 60,000 jobs.

Separately, the Institute for Supply Management-Chicago business barometer fell to 59.1 in June from 59.7 in May, and economists had forecast a June reading of 59.0. A reading above 50 indicates expansion in the regional economy.

The private sector job figures added to worries about a slowing labour market recovery ahead of tomorrow's widely watched US government payrolls and unemployment report.

The top flight – about to complete its worst quarter since the start of last year – closed 2.65 points higher at 4916.87 in a lacklustre fightback following Tuesday's 3 per cent plunge.

Worries about the imminent repayment of loans made to banks by the European Central Bank have been making an impact on shares.

But the ECB later said it had lent a smaller than expected 107bn in three-month money to banks refinancing the loans, managing to ease balance sheet fears.

In currency news, the pound's recent strong run stalled, with sterling down 0.6 per cent to just under 1.50 dollars and off 1.5 per cent below 1.22 euros.

The Footsie risers were led by AstraZeneca after the pharmaceuticals giant won a three-year battle over its Crestor cholesterol drug which will keep cheap rivals at bay in the US until 2016.

Shares jumped 222p to 3169p, while fellow drugs giant GlaxoSmithKline added 20p to 1143p. BP was second on the risers' board as broker speculation about the prospect of a bid from ExxonMobil once the Gulf of Mexico situation has stabilised meant the beleaguered UK company pulled clear of its recent 14-year lows.

Shares were 5 per cent higher, up 16p to 3187/8p, during a generally better session for commodity-based stocks. Other risers in the oil sector included Cairn Energy, which lifted 63/4p to 4147/8p.

Barclays led a strong session for banks after it set out new targets for its UK retail banking and Barclaycard division over the next three years.

The plans, which were unveiled at the start of an investor briefing, included a 1bn spend on improving customer service over four years. Shares jumped 31/4p to 2701/2p.

Outside the top flight, shares in housebuilders were under pressure after Nationwide said the average cost of a property crept ahead just 0.1 per cent in June.

Taylor Wimpey fell 2p to 263/8p while Redrow slipped 61/4p to 1127/8p.

Resolution was one of the leading risers in the FTSE 250 Index, up 3p to 631/4p as its shares traded for the first time since its deal to buy the UK life and pensions operation of Axa.

It was joined on the way up by social housing firm Connaught, which has tumbled since a warning on Friday that George Osborne's emergency Budget will hit revenues and profits. Shares, which were at 325p last week, rose 81/8p to 1151/4p.

The biggest Footsie risers of the session were AstraZeneca, BP, Essar Energy up 175/8p to 4751/4p and Petrofac ahead 26p to 1186p.

The biggest Footsie fallers were Man Group down 173/4p to 2231/4p, InterContinental Hotels off 42p to 1063p, Kazakhmys down 38p to 994p and Eurasian Natural Resources, which finished off 321/2p to stand at 861p.