London midday: Stocks bounce back from heavy losses

London stocks had extended gains by midday on Thursday, bouncing back from the heavy losses seen in the previous session after tensions between the US and China escalated.

The FTSE 100 was up 0.7% to 7,647.46, having fallen 1.3% on Wednesday after US President Trump followed through with his threat to slap tariffs on an additional $200bn worth of Chinese imports.

The pound was up 0.1% against the euro at 1.1321 and flat versus the dollar at 1.3208 as the UK government was set to publish its 100-page Brexit White Paper in the afternoon, giving a full run-down of its proposal for divorce from the European Union.

Meanwhile, investors were digesting a Bloomberg report suggesting that Chinese and US officials have shown willingness to resume talks over trade between the two nations after.

Oanda analyst Craig Erlam said: "Many agree that tariffs will ultimately be bad for the global economy and therefore markets but there still seems to be some hope that common sense will prevail and a full blown trade war will be averted.

"With Donald Trump now pursuing another $200 billion in tariffs against China though, we may have to wait a while as he is not easing up and China - and others - is determined to prove it will not be bullied into submission. Perhaps if the economy starts to suffer or the Republicans do badly in the midterms in November Trump will be forced to consider an alternative approach."

In corporate news, Sky rose as the battle for the London-listed broadcaster stepped up a notch after US media giant Comcast raised its bid late on Wednesday to £14.75 per share from £12.50, trumping the sweetened £14 per share bid from 21st Century Fox that was made just hours earlier.

Miner Rio Tinto was lifted as it agreed to sell its entire interest in the Grasberg mine in Indonesia to the country's state mining company for $3.5bn. Most of the other mining giants were just on the good side of flat.

Computacenter surged after saying that 2018 results are likely to be "comfortably in excess" of the expectations it set out in its first quarter trading update following a strong start to the year.

Outsourcer Capita gained as it said it expects to raise more than £400m from non-core asset disposals this year, £100m ahead of its previous target. It also won a new contract to manage SATs testing in primary schools.

Bookmaker Paddy Power was on the rise after England was knocked out of the World Cup by Croatia, meaning there'll be no big payout to punters with big hopes for the team.

B&M European Value Retail nudged up after reporting a jump in first-quarter revenue despite challenging market conditions.

Dunelm slid as it reported flat like-for-like revenues and squeezed profit margins in the fourth quarter, meaning the homewares retailer expects full year underlying profit to fall almost 7% to £102m.

Outside the FTSE 350, retailer DFS was also under the cosh as it warned on profits, saying the hot weather put off customers in the fourth quarter, while AIM-listed ASOS fell sharply after saying that its full-year sales growth would be "towards the lower end" of its previous 25% to 30% guidance.

Premier Oil gushed lower after a trading and operations update, while waste business Renewi slipped despite saying trading in the quarter from April 1 was in line with management's expectations with merger synergy and integration projects progressing well.

Halma, Primary Health Properties, Safestore, Superdry, Telecom Plus and WH Smith were among the companies whose stock went ex-dividend.

On the broker note front, ITV was hit by a downgrade to ‘neutral’ by Goldman Sachs, while Pagegroup was downgraded to ‘hold’ at Kepler Cheuvreux and Intu was reduced to ‘sell’ at Deutsche Bank. UBS downgraded Kingspan to 'sell' and Travis Perkins to 'neutral'.

Sky was cut to ‘neutral’ at Macquarie, but Indivior got a boost as Bank of America Merrill Lynch upgraded the stock to ‘buy’ following recent share price weakness.

Market Movers

FTSE 100 (UKX) 7,647.46 0.73%
FTSE 250 (MCX) 20,751.51 0.53%
techMARK (TASX) 3,550.60 0.83%

FTSE 100 - Risers

Sky (SKY) 1,533.50p 2.64%
Paddy Power Betfair (PPB) 8,500.00p 2.35%
GVC Holdings (GVC) 1,107.00p 2.12%
Burberry Group (BRBY) 2,054.00p 1.88%
Glencore (GLEN) 316.97p 1.87%
Admiral Group (ADM) 1,934.00p 1.84%
NMC Health (NMC) 3,628.00p 1.80%
AstraZeneca (AZN) 5,337.50p 1.67%
Micro Focus International (MCRO) 1,203.50p 1.65%
Compass Group (CPG) 1,625.00p 1.63%

FTSE 100 - Fallers

ITV (ITV) 173.48p -2.24%
Ocado Group (OCDO) 1,035.50p -1.05%
Sainsbury (J) (SBRY) 326.30p -0.67%
Smurfit Kappa Group (SKG) 3,146.00p -0.57%
Morrison (Wm) Supermarkets (MRW) 254.70p -0.51%
Shire Plc (SHP) 4,298.00p -0.49%
Ashtead Group (AHT) 2,340.00p -0.38%
Next (NXT) 6,028.00p -0.36%
International Consolidated Airlines Group SA (CDI) (IAG) 668.60p -0.33%
BT Group (BT.A) 227.25p -0.26%

FTSE 250 - Risers

Computacenter (CCC) 1,468.00p 6.84%
Capita (CPI) 171.85p 6.64%
Sophos Group (SOPH) 510.70p 4.22%
Inmarsat (ISAT) 546.32p 3.35%
Alfa Financial Software Holdings (ALFA) 163.40p 3.16%
Provident Financial (PFG) 641.20p 2.66%
Vesuvius (VSVS) 585.00p 2.63%
Mediclinic International (MDC) 539.60p 2.55%
Contour Global (GLO) 250.00p 2.46%
Convatec Group (CTEC) 205.20p 2.40%

FTSE 250 - Fallers

Telecom Plus (TEP) 1,095.29p -4.42%
Intu Properties (INTU) 177.82p -3.70%
Equiniti Group (EQN) 209.97p -3.68%
Entertainment One Limited (ETO) 367.12p -3.39%
SIG (SHI) 128.20p -2.81%
Travis Perkins (TPK) 1,371.16p -2.20%
Superdry (SDRY) 1,323.00p -2.00%
TBC Bank Group (TBCG) 1,710.00p -1.84%
Premier Oil (PMO) 128.77p -1.70%
Bakkavor Group (BAKK) 187.00p -1.58%