London pre-open: Stocks to nudge up amid Sino-US trade progress, Brexit woes

London stocks were set for a muted start on Monday as concerns about Brexit overshadowed progress in Sino-US trade talks.

The FTSE 100 was called to open just three points higher at 7,189.

There was some good news on the trade front after US President Trump said overnight that the 1 March deadline for the implementation of higher tariffs on Chinese imports will be delayed.

Trump tweeted: "I am pleased to report that the U.S. has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues.

"As a result of these very productive talks, I will be delaying the US increase in tariffs now scheduled for March 1. Assuming both sides make additional progress, we will be planning a summit for President Xi and myself, at Mar-a-Lago, to conclude an agreement. A very good weekend for US & China!"

However, worries about Brexit were set to weigh on investors’ minds as Prime Minister Theresa May delayed the meaningful vote on her deal until 12 March - just two weeks before the UK is set to leave the EU.

"This is a gamble that she hopes will buy her more time for negotiations,” said London Capital Group analyst Jasper Lawler. "But she risks infuriating ministers who are already prepared to revolt against her."

In corporate news, like-for-like sales at the Primark retail arm of Associated British Foods have fallen 2% in the first half of the year but full year guidance remained unchanged.

At the top line, Primark grew sales 4% due to expansion of selling space, while the grocery, agriculture and ingredients divisions all reported improved revenues, while sugar sales have been strongly diluted by the new EU price regime.

Distribution group Bunzl said it was stockpiling to mitigate against border delays if the UK crashed out of the European Union without a deal as it reported a rise in full year pre-tax profits.

The company said profits at constant exchange rates rose 6% to £559m on the back of a 9% increase in revenue to £9bn.

In a separate announcement, Bunzl said it was buying Liberty Glove & Safety, a supplier of safety products to distributors based in the US. The business supplies a full range of personal protection equipment with a focus on gloves. Revenue in 2018 was £70m.

Doorstep lender Provident Financial has rejected a £1.3bn offer from smaller rival Non-Standard Finance, calling it "highly opportunistic".

On Friday, Non-Standard Finance offered 8.88 new NSF shares for each Provident Financial share. Based on NSF’s closing share price of 58p a share the day before, this values each Provident share at 511p.

But Provident expressed its disappointment at the unsolicited bid on Monday, highlighting the fact that NSF had decided not to engage with the board prior to the announcement.

"The board considers that this hostile offer represents an irresponsible approach in the context of a financially regulated business which is recovering from a period of substantial instability. The board believes that this offer could have a negative and destabilising impact on its stakeholders, including its customers, for a considerable period of time."