London open: Stocks rise ahead of retail sales, Rio to the fore

London stocks edged higher in early trade on Thursday as investors continued to brush off trade tensions between the US and China, and looked ahead to the release of UK retail sales data.

At 0825 BST, the FTSE 100 was up 0.2% to 7,346.57, while the pound was 0.2% firmer against the dollar at 1.3174 and flat versus the euro at 1.1263.

CMC Markets analyst David Madden said: "Trade tensions have stepped up, but you wouldn’t know it to look at European and US equity markets. The $200bn worth of tariffs from Trump, and Beijing’s reaction weren’t exactly a surprise. Investors are cautiously optimistic as that round of tariffs weren’t too severe. Equities in Asia overnight were mixed as the mood isn’t particularly strong one way or another.

"The Trump administration and Beijing have hardened their positions, but as long as trading relations don’t take another sour turn, investors could remain upbeat."

Brexit was also in focus after Prime Minister Theresa May urged EU leaders at a dinner in Salzburg on Wednesday to focus on agreeing a deal in the next two months and drop their "unacceptable" demands. May told the EU's other 27 heads of government that the UK will leave on 29 March next year and that the onus was on all of them to get a deal done.

Meanwhile, a report overnight revealed an internal memo suggesting that May's party could force her to stand down soon after the March 2019 Brexit date. The dossier leaked to the Telegraph was said to have been widely circulated among Tory MPs, analysing the leadership of her cabinet colleagues and other contenders including Boris Johnson and Jacob Rees-Mogg.

On the data front, retail sales figures for August are due at 0930 BST.

In corporate news, Rio Tinto was the standout gainer as it outlined its plans to return around $3.2bn to shareholders through a share buyback programme following the disposal of its coal assets.

British American Tobacco was just a touch higher as it announced that chief executive Nicandro Durante will retire next April after eight years in charge of the cigarette company.

Inmarsat rallied as it announced that it and Panasonic Avionics Corporation have agreed a strategic collaboration to provide in-flight broadband for commercial airlines.

On the downside, Diageo ticked lower after revealing that it has been buffeted in recent weeks by increased emerging market foreign exchange volatility. The drinks titan said that despite "increased volatility in some markets", it still expects organic net sales growth broadly in line with last year.

Construction, services and property group Kier was in the red even as it posted a 9% rise in underlying full-year pre-tax profit thanks to a solid performance from all of its divisions and despite turbulence in its markets.

IG Group tumbled after reporting a drop in first-quarter revenue as it took a hit from lower client activity amid new EU regulatory measures.

Southend airport owner Stobart Group slipped as it said full-year results for its energy division are likely to be below expectations due to delays in commissioning.

Saga fell as it announced the appointment of James Quin - formerly UK chief financial officer of Zurich Insurance Group - as group CFO with effect from 1 January 2019.

In broker note action, Aveva was lifted to 'overweight' at Barclays, while Gem Diamonds and Petra Diamonds were started at 'buy' and 'hold' respectively at Berenberg.

TP ICAP was upgraded to 'hold' at Shore Capital, while Boohoo was boosted to 'buy' by the same outfit.

Weir was lifted to 'overweight' by Morgan Stanley.

GVC Holdings, Crest Nicholson, Drax, Petrofac, Rank Group, Redrow, Renishaw, Sanne, Sophos, Unite and International Public Partnerships were among the companies whose stock went ex-dividend.

Market Movers

FTSE 100 (UKX) 7,346.57 0.21%
FTSE 250 (MCX) 20,516.69 0.08%
techMARK (TASX) 3,486.84 0.03%

FTSE 100 - Risers

Rio Tinto (RIO) 3,795.50p 1.96%
Standard Chartered (STAN) 625.90p 1.36%
Antofagasta (ANTO) 847.80p 1.29%
Relx plc (REL) 1,517.50p 0.93%
Glencore (GLEN) 322.43p 0.88%
Pearson (PSON) 857.40p 0.87%
Scottish Mortgage Inv Trust (SMT) 531.70p 0.64%
BHP Billiton (BLT) 1,609.00p 0.64%
easyJet (EZJ) 1,434.00p 0.63%
Ocado Group (OCDO) 904.60p 0.58%

FTSE 100 - Fallers

GVC Holdings (GVC) 993.50p -0.50%
Rightmove (RMV) 473.90p -0.44%
Berkeley Group Holdings (The) (BKG) 3,681.00p -0.41%
Kingfisher (KGF) 246.00p -0.40%
Burberry Group (BRBY) 2,104.00p -0.33%
ITV (ITV) 152.55p -0.29%
Bunzl (BNZL) 2,394.00p -0.29%
Vodafone Group (VOD) 168.34p -0.28%
Smiths Group (SMIN) 1,561.00p -0.26%
London Stock Exchange Group (LSE) 4,750.00p -0.25%

FTSE 250 - Risers

Inmarsat (ISAT) 516.00p 3.86%
Weir Group (WEIR) 1,804.50p 3.86%
TP ICAP (TCAP) 302.50p 2.79%
Go-Ahead Group (GOG) 1,691.00p 2.18%
Aveva Group (AVV) 2,900.00p 2.04%
Entertainment One Limited (ETO) 390.21p 1.99%
Dixons Carphone (DC.) 171.00p 1.66%
Ferrexpo (FXPO) 174.20p 1.31%
Cairn Energy (CNE) 217.64p 1.23%
JD Sports Fashion (JD.) 489.80p 1.09%

FTSE 250 - Fallers

IG Group Holdings (IGG) 814.50p -5.73%
Redrow (RDW) 582.29p -2.87%
Spire Healthcare Group (SPI) 160.00p -2.44%
Crest Nicholson Holdings (CRST) 366.69p -2.37%
Playtech (PTEC) 487.91p -1.97%
International Public Partnerships Ltd. (INPP) 151.39p -1.57%
Drax Group (DRX) 358.70p -1.46%
Stobart Group Ltd. (STOB) 239.00p -1.44%
John Laing Group (JLG) 305.94p -1.25%
Petrofac Ltd. (PFC) 625.55p -1.21%