London midday: Stocks jump despite simmering trade tensions

Stocks are continuing to push higher come midday, as global trade concerns are shrugged off and in sync with resurgent European markets as political worries around Italy and Spain appear to ebb.

The FTSE 100 was rising 63.90 points or 0.89% to 7,770.70 come midday, even as Sterling was consolidating its slight recovery from the end of last week, adding 0.21% against the US dollar to 1.33761 but down 0.32% on the euro at 1.1410.

Following two days of talks, at the weekend Beijing threatened to withdraw from its previously agreed commitments with Washington to cut its bilateral trade deficit on goods with the US if President Donald Trump movd ahead with tariffs on $50bn-worth of Chinese products.

A feisty G7 meeting over the weekend also saw the US Treasury Secretary having to fend-off his furious European and Canadian peers as they vented about last week's trade tariff announcement from the White House, but neither issue seemed to have much impact on Monday's trading.

Markets being "surprisingly sanguine", Jasper Lawler at London Capital Group said.

"The markets are reacting with the same indifference with which they responded to the tariffs being levied on the US’s closest allies last week, in a sign that traders are becoming increasingly accustomed to Trump’s heavy-handed negotiating tactics. There remains a certain level of optimism that this aggressive posture from Trump is a positioning that will quickly blow over, rather than result in the actual application of US tariffs and the application of threatened retaliatory measures from the targeted countries."

In what is a fairly quiet week for major economic data, in which purchasing managers' reports will be the main points of interest.

On that note, Markit/CIPS reported that its construction purchasing managers' index for May remained at 52.5 for the second month, when the market had expected it to fall to 51.5.

A PMI reading above 50 indicates growth.

In company news, DS Smith said it was buying Spanish packaging firm Europac for €1.67bn (£1.45bn). The acquisition, transaction expenses and the refinancing of Europac debt will be financed from a £1bn rights issue and a new committed debt facility of €740m (£645m), the company added.

Rolls-Royce confirmed that it has completed the sale of its fuel injector business, L'Orange, for net proceeds of €673m after costs.

CYBG, the owner of Clydesdale and Yorkshire Bank, has upped the price of its proposed takeover approach for rival Virgin Money, which has agreed to push back the bid deadline. CYBG would offer 1.2125 new shares for each Virgin Money share, potentially giving Virgin Money shareholders a 38% stake in the combined group, up from the 1.1297 original offer made last month that would have led to a 36.5% ownership. Shares in CYBG were up and Virgin Money was down slightly.

Shares in BT Group were higher too as investor support for chief executive Gavin Patterson was reported to be "crumbling", by the Financial Times, with several top-20 shareholders warning they are running out of patience.

Wizz Air said its passenger numbers grew once again in May, as the airline's route network continued to expand, with capacity for the month rising 17.1% year-on-year to 3,086,626, and passengers up 18.1% to 2,836,380. The FTSE 250 low-cost carrier said its load factor grew by 0.8 percentage points for the month to 91.9%.

SIG was leading the risers on the FTSE 250 after being upgraded to 'buy' at broker Liberum.

Market Movers

FTSE 100 (UKX) 7,764.82 0.82%
FTSE 250 (MCX) 21,087.77 0.49%
techMARK (TASX) 3,562.39 0.48%

FTSE 100 - Risers

United Utilities Group (UU.) 806.00p 3.23%
Severn Trent (SVT) 2,050.00p 3.22%
easyJet (EZJ) 1,766.50p 3.09%
Smith (DS) (SMDS) 579.20p 2.99%
International Consolidated Airlines Group SA (CDI) (IAG) 704.80p 2.77%
National Grid (NG.) 848.10p 2.38%
Fresnillo (FRES) 1,339.00p 2.33%
ITV (ITV) 167.70p 2.01%
Marks & Spencer Group (MKS) 290.00p 1.90%
Diageo (DGE) 2,765.50p 1.82%

FTSE 100 - Fallers

Smurfit Kappa Group (SKG) 2,934.00p -5.42%
Shire Plc (SHP) 3,950.00p -2.11%
Evraz (EVR) 520.40p -0.42%
Paddy Power Betfair (PPB) 9,000.00p -0.39%
Persimmon (PSN) 2,860.00p -0.17%
Rolls-Royce Holdings (RR.) 836.60p -0.05%
Mediclinic International (MDC) 607.40p -0.03%
Sage Group (SGE) 664.25p 0.04%
3i Group (III) 955.60p 0.04%
Bunzl (BNZL) 2,311.50p 0.15%

FTSE 250 - Risers

SIG (SHI) 142.70p 6.18%
Purecircle Limited (DI) (PURE) 379.00p 3.84%
Pennon Group (PNN) 784.60p 3.78%
Provident Financial (PFG) 666.00p 2.87%
IWG (IWG) 319.40p 2.87%
Stobart Group Ltd. (STOB) 220.07p 2.84%
BTG (BTG) 617.00p 2.66%
Bakkavor Group (BAKK) 200.00p 2.56%
Shaftesbury (SHB) 940.50p 2.56%
Bank of Georgia Group (BGEO) 2,021.50p 2.51%

FTSE 250 - Fallers

Alfa Financial Software Holdings (ALFA) 159.74p -13.65%
Hunting (HTG) 800.00p -6.87%
FirstGroup (FGP) 91.80p -4.23%
Weir Group (WEIR) 2,149.00p -3.29%
On The Beach Group (OTB) 467.00p -3.21%
Contour Global (GLO) 216.00p -2.70%
Cairn Energy (CNE) 234.60p -1.43%
Greggs (GRG) 1,045.00p -1.32%
888 Holdings (888) 295.60p -1.00%
Petrofac Ltd. (PFC) 592.40p -1.00%