By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) -- The FTSE 100 was set for a gain of
around 2.8% for the week, but Friday's session saw some
backtracking as investors struggled to read better-than-expected
U.S. jobs data.
London stocks failed to follow up from a blockbuster Thursday
session. The FTSE 100 index logged its best one-day advance and
percentage gain since fall 2011 on Thursday, rising 3%, or 191.80
points, to 6,421.67 after strong hints from the Bank of England
that it will keep its monetary policy accommodative.
On Friday, the index declined 0.5% to 6,388.30, despite
better-than-expected June jobs growth for the U.S. and upward
revisions to data for the two previous months. Analysts said the
data will keep the Fed on track for tapering its bond-buying
program.
Several miners stepped back after posting strong gains on
Thursday. Shares of Rio Tinto PLC (RIO) fell 4%, BHP Billiton PLC
(BHP) declined 3.4% and Glencore Xstrata PLC tumbled 4.9%. Shares
of Randgold Resources Ltd. fell 5% even as Nomura lifted shares to
neutral from reduce.
Shares of Whitbread PLC fell nearly 3% after UBS strategists cut
the firm to neutral from buy, after an investment day. "While we
view the new brand and international expansion plans positively, we
do not think these initiatives change the near-term outlook," said
Jarrod Castle, analyst at UBS.
Shares of index heavyweight HSBC Holdings PLC (HBC) rose 0.3%,
providing some support for the FTSE.
Goldman Sachs said in a note on Friday that it was advising
going long U.K. equities and targeting 7,100 for the FTSE 100. The
investment bank gave three reasons for its view: first, the U.K.
economy looks to be on an upswing and second, monetary policy looks
set to ease further, especially after Thursday's dovish statement
from the Bank of England, led by new Governor Mark Carney.
"Third, our forecasts also envisage a gradual stabilization in
euro area growth in the second half of the year. As one of the
U.K.'s largest trading partners, the gradual improvement in growth
here should also be a tailwind for the U.K. economy and U.K.
markets," wrote economist Noah Weisberger in a note.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires