UK stocks rise as weak jobs data cools rate hike worries

UK equities rose on Tuesday after data pointed to a softer labour market that eased worries of ‌an immediate rate hike.

The blue-chip FTSE 100 index rose 0.61% as of 11:13 am GMT, while the midcap FTSE 250 climbed 0.81%. * Data from the tax office showed ‌that April payrolls fell 100,000 from March, while the unemployment rate ticked up ‌to 5% for the first quarter, from 4.9% in the three months to February.

* "Today's labour market report will not just make for an uncomfortable reading, it will likely stop the MPC (Bank of England's ⁠Monetary Policy ​Committee) in its ⁠tracks," said Sanjay Raja, chief UK economist at Deutsche Bank. * Traders expect a 29.1% chance of ⁠a rate hike at the June meeting, according to data compiled by LSEG.

* "We're still forecasting ​a rate hike in June, but that is far from guaranteed," said ⁠James Smith, ING's developed markets economist, UK. * The reprieve in equities gave investors breathing room after a ⁠period ​marked by elevated political uncertainty.

* On Monday, Prime Minister Keir Starmer reiterated that he would remain at the helm, but several of his Labour Party's lawmakers ⁠have called for him to quit. * Investment banking shares rose 2.58%, while retailers advanced ⁠2.49%.

* IG ⁠Group rose 10.22%, the biggest gainer on the FTSE 100, after it raised its annual and medium-term revenue forecasts for the ‌second time ‌this year.

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