(Sharecast News) - London stocks fell in early trade on Tuesday as investors mulled disappointing UK jobs data.
At 0850 BST, the FTSE 100 was down 0.6% at 5,965.52.

According to the Office for National Statistics, the unemployment rate rose more than expected August, hitting its highest level in three years as the coronavirus pandemic continues to take its toll. The unemployment rate increased to 4.5% from 4.1% in July, coming in above consensus expectations of 4.3%.

The ONS said estimates for June to August show an estimated 1.52m people were unemployed, up 209,000 on a year earlier and 138,000 higher than the previous quarter.

Redundancies increased in June to August by 113,000 on the year, and a record 114,000 on the quarter, to 227,000. The annual increase was the largest since April to June 2009, with the number of redundancies at its highest level since May to July 2009.

ONS deputy national statistician for Economic Statistics Jonathan Athow said: "Since the start of the pandemic there has been a sharp increase in those out of work and job hunting but more people telling us they are not actively looking for work. There has also been a stark rise in the number of people who have recently been made redundant."

Laith Khalaf, financial analyst at AJ Bell, said: "Looking forward things look set to get worse before they get better for the UK economy, as furlough expires and greater social restrictions are enforced, albeit not nationwide. The huge cost of the Covid crisis response also needs to be reckoned with.

"The IFS estimates borrowing will hit £350 billion this year, a level never seen in peacetime Britain. The government will probably wait until it can at least see the edge of the woods before it lays out its plans to balance the books, but tax rises looks set to be on Rishi's menu."

Chinese trade data was more upbeat, with exports up 9.9% on the year in September and imports 13.2% higher.

In equity markets, stocks with significant exposure to the pandemic and related restrictions were under the cosh. Engine maker Rolls-Royce was the worst performer following strong gains in the previous session, closely followed by British Airways and Iberia parent IAG, Premier Inn owner Whitbread, GKN owner Melrose and InterContinental Hotels.

Cineworld, Upper Crust owner SSP, pub chain Mitchells & Butlers, cruise operator Carnival and travel company TUI also fell sharply.

On the upside, SSE rallied after agreeing to sell its 50% share in its Multifuel energy-from-waste ventures to Australian fund manager First Sentier Investors for £995m in cash as part of its £2bn disposal programme.

Market Movers

FTSE 100 (UKX) 5,965.52 -0.60%
FTSE 250 (MCX) 18,068.95 -0.54%
techMARK (TASX) 3,868.50 -0.82%

FTSE 100 - Risers

SSE (SSE) 1,368.00p 3.17%
Experian (EXPN) 3,066.00p 1.73%
Morrison (Wm) Supermarkets (MRW) 174.40p 1.16%
Fresnillo (FRES) 1,343.50p 0.90%
Sainsbury (J) (SBRY) 201.80p 0.80%
Tesco (TSCO) 220.70p 0.73%
Just Eat Takeaway.Com N.V. (CDI) (JET) 8,946.00p 0.63%
Vodafone Group (VOD) 112.52p 0.61%
Anglo American (AAL) 1,941.20p 0.58%
Antofagasta (ANTO) 1,030.00p 0.49%

FTSE 100 - Fallers

Rolls-Royce Holdings (RR.) 181.50p -6.85%
International Consolidated Airlines Group SA (CDI) (IAG) 97.56p -4.12%
Hargreaves Lansdown (HL.) 1,506.50p -2.30%
Whitbread (WTB) 2,270.00p -1.86%
Burberry Group (BRBY) 1,560.00p -1.76%
Melrose Industries (MRO) 128.30p -1.65%
Pearson (PSON) 561.60p -1.65%
Compass Group (CPG) 1,203.50p -1.63%
InterContinental Hotels Group (IHG) 4,212.00p -1.52%
Associated British Foods (ABF) 1,845.00p -1.49%

FTSE 250 - Risers

BlackRock Smaller Companies Trust (BRSC) 1,396.00p 2.50%
Hill & Smith Holdings (HILS) 1,210.00p 1.85%
Airtel Africa (AAF) 66.10p 1.69%
Pets at Home Group (PETS) 411.00p 1.33%
FirstGroup (FGP) 53.10p 1.24%
Telecom Plus (TEP) 1,340.00p 1.21%
Tritax Big Box Reit (BBOX) 166.40p 1.16%
Premier Foods (PFD) 98.20p 1.03%
IP Group (IPO) 80.80p 1.00%
Virgin Money UK (VMUK) 90.40p 0.94%

FTSE 250 - Fallers

Cineworld Group (CINE) 26.61p -10.10%
Meggitt (MGGT) 292.90p -5.42%
CMC Markets (CMCX) 329.50p -4.91%
SSP Group (SSPG) 188.30p -4.66%
Mitchells & Butlers (MAB) 135.20p -3.98%
Aston Martin Lagonda Global Holdings (AML) 50.65p -3.52%
TUI AG Reg Shs (DI) (TUI) 282.60p -3.29%
Carnival (CCL) 958.80p -3.17%
Babcock International Group (BAB) 266.50p -3.09%
National Express Group (NEX) 162.20p -2.99%