LONDON (ShareCast) - (ShareCast News) - Stocks in London surrendered a good portion of their early gains this afternoon as US-North Korea tensions ratcheted to new highs.
Gold, the nil-yielding and safe-haven asset, was predictably riding higher, while sterling ran north against a retreating greenback and was helped by UK inflation data this morning.

The FTSE 100 closed up 0.23% at 7,365.50, and the FTSE 250 ended Tuesday up 0.22% to 19,306.52. The FTSE 100 enjoyed a late rise, but this was insufficient to help it return to earlier highs. In the US, the Dow, S&P 500 and Nasdaq were strongly lower, and so, too, Europe's Euro Stoxx 50, Dax and Cac 40.

This all followed US President Donald Trump saying on Twitter that North Korea was "looking for trouble" and warned the US would "solve the problem," either with or without China's help.

Trump's keyboard vent came after Pyonyang promised a strong reaction if the US dared to opt for a military action, warning of "catastrophic consequences". This added to existing concerns surrounding North Korea's testing of ballistic missiles in recent months.

Diplomatic relations between the US and Russia remained taught over a recent US missile strike on an airbase in Syria linked to the alleged use of chemical weapons in that country's civil war.

"Trump is clearly playing a game of high stakes poker with North Korea and China of late, yet the only problem is that he is doing so against a hugely unpredictable nation," said Joshua Mahony, market analyst at IG.

"Chief amongst today's winners have been the likes of Randgold Resources and Fresnillo, who have understandably piggybacked on the sharp appreciation of gold as fears over US military action in North Korea heighten risk aversion," said Mahony.

Spreadex financial analyst Connor Campbell commented that the Dow's decline seemed inspired by the global tensions sparked by Trump's unravelling relationship with Russia (and Syria. And North Korea), adding that this contagion had reached the Eurozone.

"Today's inflation data was a bit of a bust in the excitement stakes; it will be interesting to see if tomorrow's jobs report is similarly stable or, more specifically, if the gap between inflation and wage growth has widened any further," said Campbell.

Earlier on Tuesday, Office for National Statistics confirmed that the UK consumer-price index held at 2.3% in March, that was in-line with forecasts but above Bank of England's targeted 2%.

"Today's inflation figures don't show the kind of overshoot that might prompt a sea change in the outlook for monetary policy in the UK or for sterling," said analyst Ranko Berich at Monex Europe. He noted the trend for accelerating inflation was likely to continue.

Turning to the blue-chip equities ladder, house builders and commercial property did well, as did tobacco stocks, consumer goods and a number of supermarkets and retailers.

Oil giants BP and Shell fell ahead of US inventory figures and Opec output reports later on Tuesday, while multi-commodity miners slid with industrial-metals futures. Banks were also lower.

British Airways and Iberia parent International Consolidated Airlines Group was lifted by a positive note from Exane BNP Paribas, which rates the stock at 'outperform'.

Balfour Beatty was lifted by an upgrade to 'buy' from 'neutral' from Bank of America-Merrill Lynch.

Market Movers

FTSE 100 (UKX) 7,365.50 0.23%
FTSE 250 (MCX) 19,306.52 0.22%
techMARK (TASX) 3,439.67 0.09%

FTSE 100 - Risers

Randgold Resources Ltd. (RRS) 7,580.00p 4.84%
Fresnillo (FRES) 1,652.00p 4.36%
easyJet (EZJ) 1,078.00p 2.08%
International Consolidated Airlines Group SA (CDI) (IAG) 539.50p 2.08%
Land Securities Group (LAND) 1,115.00p 1.83%
Rolls-Royce Holdings (RR.) 810.50p 1.69%
Bunzl (BNZL) 2,370.00p 1.63%
Croda International (CRDA) 3,585.00p 1.50%
Persimmon (PSN) 2,210.00p 1.47%
Aviva (AV.) 520.00p 1.36%

FTSE 100 - Fallers

Royal Bank of Scotland Group (RBS) 234.50p -1.88%
Anglo American (AAL) 1,217.50p -1.38%
Standard Chartered (STAN) 726.60p -1.36%
Carnival (CCL) 4,544.00p -1.30%
Hikma Pharmaceuticals (HIK) 1,921.00p -1.28%
Provident Financial (PFG) 3,125.00p -1.11%
CRH (CRH) 2,757.00p -1.01%
Pearson (PSON) 629.50p -0.94%
Smurfit Kappa Group (SKG) 2,042.00p -0.68%
GKN (GKN) 352.90p -0.65%

FTSE 250 - Risers

JD Sports Fashion (JD.) 440.10p 8.24%
Balfour Beatty (BBY) 286.40p 5.84%
Sanne Group (SNN) 735.50p 4.47%
Polymetal International (POLY) 1,084.00p 3.73%
Daejan Holdings (DJAN) 6,660.00p 3.34%
Hays (HAS) 162.50p 2.98%
AO World (AO.) 138.90p 2.89%
Hochschild Mining (HOC) 285.00p 2.89%
Just Eat (JE.) 572.50p 2.60%
Acacia Mining (ACA) 473.80p 2.44%

FTSE 250 - Fallers

Tullow Oil (TLW) 229.10p -4.10%
Cairn Energy (CNE) 206.40p -3.28%
Ibstock (IBST) 200.30p -3.00%
Sophos Group (SOPH) 321.90p -2.45%
Northgate (NTG) 525.50p -2.41%
Aldermore Group (ALD) 232.10p -2.03%
Elementis (ELM) 280.30p -1.96%
Ashmore Group (ASHM) 362.60p -1.84%
Ascential (ASCL) 315.00p -1.69%
Clarkson (CKN) 2,721.00p -1.56%

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