London stocks opened lower on Tuesday as fresh UK labour market figures showed slowing wage growth and a decline in job vacancies, raising concerns about the strength of the British economy ahead of Wednesday’s inflation report.
The FTSE 100 fell 0.2% to 10,741.45 in early trading, extending Monday’s losses as investors assessed the latest employment figures.
The domestically focused FTSE 250 declined 0.8% to 24,326.94, underperforming the blue-chip index as concerns over economic conditions weighed on smaller and mid-sized UK companies.
The latest labour market data indicated that wage growth was easing while the number of available jobs continued to fall, suggesting employers are becoming more cautious about recruitment.
Slower wage growth could help ease inflationary pressures, potentially reducing the need for aggressive interest rate increases by the Bank of England.
However, weaker hiring demand also raises questions about consumer spending and the resilience of the wider economy, particularly as households face elevated borrowing and energy costs.
Investors will now turn to Wednesday’s UK consumer price inflation figures, which could provide further direction for interest rate expectations ahead of the Bank of England’s next monetary policy decision.
The FTSE 100’s subdued opening reflects continued uncertainty over the balance between slowing employment conditions, persistent inflation and the outlook for UK economic growth.
