London close: Stocks end session on a mixed note amid trade and geopolitical jitters
By Alexander Bueso
Date: Thursday 13 Jun 2019
(Sharecast News) - London stocks finished on a mixed note on Thursday amid worries about Sino-US trade relations and increased tensions in the Persian Gulf after two tankers were set ablaze, even as Boris Johnson won the first round of voting to become the next Prime Minister.
By the end of trading, the FTSE 100 was up by 0.01% at 7,368.57, while the pound was down 0.12% against the US dollar at 1.26750 and up by 0.02% versus the euro to 1.1243.
The second tier index meanwhile dropped by 0.40% to 19,172.37.
Trade relations between the US and China were in focus again after US President Trump said he had a "feeling" that a deal would get done between the two but then reiterated his threat to impose tariffs on $325bn of Chinese imports if no deal was reached.
Markets.com chief market analyst Neil Wilson however was sceptical, saying: "There are precious little signs that we are even close to seeing a deal done at the G-20. Maybe a top-level handshake between Trump and Xi but hard to see much more."
Also overseas, earlier on Friday it was reported that two tankers sailing off the coast of Oman had been set ablaze, possibly after being attacked, although the cause of the two incidents remained unclear.
The news pushed front month Brent crude oil futures higher by 1.91% to $61.14 per barrel on the ICE.
Back on home turf, Johnson won 114 of the votes cast by the 313 Tory MPs, giving him a commanding lead and possibly raising the odds of a no-deal Brexit.
On the data front, the latest survey from the Royal Institution of Chartered Surveyors showed that delaying the UK's departure from the European Union helped steady the country's housing market.
The net balance of surveyors reporting an increase in house prices over the last three months rose to -10 in May from -23 in April, coming in above consensus expectations of -21. Meanwhile, the new buyer enquiries balance recovered to -3 - its highest level since July - from -26 in April.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: "The picture is fairly uniform across UK regions, with demand only continuing to fall rapidly in the West Midlands. Looking ahead, we expect demand to recover further, as lenders pass on some of the recent fall in funding costs and as the recent improvement in consumers' confidence feeds through fully."
"The volatile political situation will continue to subdue the market, though we still think the October Brexit deadline will be extended by a further six months, creating further room for house prices to recover modestly."
In commodity markets, oil prices rallied after the US Navy's Bahrain-based Fifth Fleet said it was assisting two tankers in the Gulf of Oman after receiving distress calls from the vessels amid reports of an "attack". Brent crude was 1.96% higher at $61.14 a barrel and West Texas Intermediate was 2.05% firmer at $52.19. Oil prices had fallen to five-month lows overnight on the back of data showing a surprise build in US inventories during the previous week.
In equity markets, plumbing and heating equipment supplier Ferguson was the standout performer after US fund manager Trian Investors took a 5.89% stake in the company.
DS Smith gained as the packaging group reported better-than-expected full-year profits, with peers Smurfit Kappa and Mondi also higher.
Morrisons was on the rise on news that it and Amazon are expanding their same-day grocery delivery service.
Retirement products specialist Just Group surged after saying it remains committed to delivering capital self-sufficiency by 2022 and will target further cost cuts in its US care business.
On the downside, ex-dividends weighed, with Persimmon, WPP, Pets at Home, Mediclinic, NMC Health, Assura, Cineworld, Electrocomponents, Ferrexpo, Intermediate Capital, Severn Trent and Shaftesbury all in the frame.
Tesco was in the red as it said UK like-for-like sales growth slowed to 0.4% in the 13 weeks to 25 May, from 1.7% in the previous quarter.
Imperial leather maker PZ Cussons reversed early losses after it announced the departure of its chief financial officer and reiterated guidance for a drop in its annual profits of around £10m from the previous year.
Market Movers
FTSE 100 (UKX) 7,368.57 0.01%
FTSE 250 (MCX) 19,172.37 -0.40%
techMARK (TASX) 3,610.37 0.14%
FTSE 100 - Risers
Ferguson (FERG) 5,622.00p 5.88%
Smith (DS) (SMDS) 360.80p 5.13%
Smurfit Kappa Group (SKG) 2,388.00p 4.78%
Evraz (EVR) 689.00p 2.38%
Morrison (Wm) Supermarkets (MRW) 199.45p 2.15%
Mondi (MNDI) 1,738.00p 2.03%
CRH (CRH) 2,540.00p 2.01%
Rio Tinto (RIO) 4,810.45p 1.98%
Anglo American (AAL) 2,115.50p 1.93%
International Consolidated Airlines Group SA (CDI) (IAG) 467.20p 1.65%
FTSE 100 - Fallers
Persimmon (PSN) 1,955.00p -4.49%
WPP (WPP) 957.60p -4.38%
3i Group (III) 1,027.00p -4.38%
Next (NXT) 5,526.00p -2.13%
Severn Trent (SVT) 2,041.00p -2.02%
Auto Trader Group (AUTO) 580.20p -1.93%
Burberry Group (BRBY) 1,737.50p -1.75%
Marks & Spencer Group (MKS) 216.00p -1.46%
Hikma Pharmaceuticals (HIK) 1,637.00p -1.36%
Associated British Foods (ABF) 2,477.00p -1.35%
FTSE 250 - Risers
Just Group (JUST) 56.85p 12.69%
Kier Group (KIE) 202.40p 11.43%
Saga (SAGA) 39.72p 4.14%
Premier Oil (PMO) 72.56p 3.66%
Ibstock (IBST) 246.20p 2.93%
Bakkavor Group (BAKK) 124.80p 2.61%
Wood Group (John) (WG.) 400.60p 2.46%
Sabre Insurance Group (SBRE) 261.50p 1.95%
Tullow Oil (TLW) 198.45p 1.93%
Paragon Banking Group (PAG) 442.40p 1.84%
FTSE 250 - Fallers
Card Factory (CARD) 178.50p -6.64%
Contour Global (GLO) 201.50p -6.51%
Greene King (GNK) 612.40p -6.10%
Ted Baker (TED) 905.00p -4.74%
Pets at Home Group (PETS) 172.90p -4.53%
Rank Group (RNK) 153.40p -4.01%
Fisher (James) & Sons (FSJ) 1,846.00p -3.85%
CLS Holdings (CLI) 216.00p -3.84%
Stobart Group Ltd. (STOB) 105.40p -3.66%
Mitchells & Butlers (MAB) 278.50p -3.63%
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