London close: Stocks end on mixed note with Brexit and US-China trade in focus
London listed shares turned in another mixed session on Thursday with the the Footsie weighed down by pound strength and amid increasing 'market chatter' around the possibility of a 'no deal' Brexit.
Pushing Sterling higher, speaking before a US Congressional panel overnight, US Federal Reserve chief Jerome Powell signalled that interest rate cuts were indeed on the table and, in fact, he left some traders wondering if even a 50 basis point reduction might be possible when rate-setters met again at the end of the month.
Investor sentiment was also dented a bit after Donald Trump voiced his displeasure at the lack of any Chinese purchases of US agricultural goods.
"Hopefully they will start soon!," he said in a post on his personal account on Twitter.
Earlier, at a press conference, the spokesman for the Chinese Ministry of Commerce had reportedly said that Beijing hoped that Washington would carry through with its commitments as pertained to telecommunications equipment maker Huawei.
For some observers, the spokesman had also signalled that trade talks were set to resume soon, although others believed that Washington and Beijing were jockeying for a better position ahead of their restart and others still said the recent incorporation of more senior Chinese officials to the Beijing's trade team was a sign that the country's positioning was hardening.
By the session close, the FTSE 100 had given up its earlier gains and was down by 0.28% or 20.87 points to 7,509.82 as the pound added 0.34% versus the US dollar to reach 1.2542.
The second-tier index did manage to cling onto some gains, but only barely, adding 0.12% or 23.78 points and finishing at 19,443.16.
To take note of, the Dow Jones Industrials pushed past the 27,000 point mark and the S&P 500 past 3,000 shortly after the opening bell on Wall Street before easing back a little.
Against that backdrop, in presenting the Bank of England's Financial Stability Report on Thursday, Governor Mark Carney noted that the perceived likelihood of a no-deal Brexit had increased since the start of the year.
And although British companies had made "real progress" in preparations for an exit and the country's banks could even weather a global trade war and no-deal Brexit simultaneously, the latter could lead to "major market volatility".
Regulators in the European Union on the other hand needed to do more in order to avoid disruptions to cross-border financial links, Carney said.
Brexit also appeared to be increasingly on the minds of analysts in the City.
Commenting on the gains in homebuilders' shares in the wake of the Barratt Developments's trading update the day before, Chris Beauchamp at IG pointed out how "those investors moving in now will have to be mindful of the potential disruptions arising from a no-deal Brexit. No deal has gone from being unthinkable to a definite possibility."
Back in the UK, the Royal Institute of Chartered Surveyors's house price balance for June jumped from -9.0% for May to -1.0% in June (consensus: -12.0%), returning to its best level since October 2018 and, according to economists, pointing to a year-on-year rate of house price growth of about 2.0%.
Barratt Developments was at the top of the leaderboard for the top flight index after analysts at Morgan Stanley bumped up their target price for the homebuilders' shares, following what they termed a "robust" full-year trading update and inexpensive valuation relative to peers, but remained a tad more cautious than the company when looking out to the medium-term.
Reckitt Benckiser said it had agreed to pay to $1.4bn to resolve all US federal investigations in connection with the sales and marketing of Suboxone Film by its former prescription pharmaceuticals business Indivior. Indivior had been accused of illegally boosting prescriptions for its opioid addiction treatment by the US Justice Department. The deal was struck with US Department of Justice and Federal Trade Commission. Indivior was demerged from Reckitt in 2014.
Technical products supplier Diploma meanwhile announced it had bought the assets and trade of Virginia Sealing Products for £56m. VSP supplies gaskets and fluid sealing products to the industrial maintenance, repair and overhaul market. Further deferred payments up to £8m may be payable in late 2020 subject to achievement of operating profit targets, Diploma said.
Workspace Group reported a “good level” of customer demand in its first quarter on Thursday, with enquiries averaging 1,060 per month, compared to 1,021 a year ago, and lettings standing at 121 per month, up from 88. The FTSE 250 real estate investment trust added two new buildings, in Hoxton and Clerkenwell, and one building extension and refurbishment in Chiswick during the quarter.
FTSE 100 - Risers
Barratt Developments (BDEV) 614.40p 5.17%
Reckitt Benckiser Group (RB.) 6,590.00p 2.52%
Smith (DS) (SMDS) 355.50p 1.98%
Tesco (TSCO) 241.30p 1.77%
Melrose Industries (MRO) 180.20p 1.64%
Kingfisher (KGF) 219.80p 1.62%
Taylor Wimpey (TW.) 161.00p 1.58%
Berkeley Group Holdings (The) (BKG) 3,792.00p 1.42%
Burberry Group (BRBY) 1,948.50p 1.38%
Hargreaves Lansdown (HL.) 2,021.00p 1.23%
FTSE 100 - Fallers
Ocado Group (OCDO) 1,140.00p -6.17%
Just Eat (JE.) 626.80p -2.25%
Evraz (EVR) 612.80p -2.11%
Glencore (GLEN) 265.00p -1.91%
Halma (HLMA) 1,981.50p -1.86%
Standard Chartered (STAN) 720.60p -1.80%
AstraZeneca (AZN) 6,382.00p -1.65%
British American Tobacco (BATS) 2,900.00p -1.61%
Rightmove (RMV) 527.30p -1.60%
National Grid (NG.) 840.50p -1.57%
FTSE 250 - Risers
Diploma (DPLM) 1,461.00p 8.05%
Syncona Limited NPV (SYNC) 230.00p 5.99%
Wood Group (John) (WG.) 514.20p 5.17%
Sirius Minerals (SXX) 15.89p 4.27%
NewRiver REIT (NRR) 170.40p 3.02%
TI Fluid Systems (TIFS) 195.20p 2.63%
Cobham (COB) 115.65p 2.62%
Meggitt (MGGT) 541.80p 2.57%
Sports Direct International (SPD) 257.20p 2.55%
Stagecoach Group (SGC) 132.40p 2.48%
FTSE 250 - Fallers
Aston Martin Lagonda Global Holdings (AML) 928.80p -3.99%
Intu Properties (INTU) 75.38p -3.36%
Domino's Pizza Group (DOM) 261.50p -3.26%
IP Group (IPO) 72.70p -3.08%
Kainos Group (KNOS) 616.00p -2.84%
Greggs (GRG) 2,350.00p -2.24%
Safestore Holdings (SAFE) 631.50p -2.09%
Contour Global (GLO) 174.00p -2.03%
Energean Oil & Gas (ENOG) 982.00p -2.00%
Aggreko (AGK) 789.20p -1.79%