London open: Stocks edge lower as investors eye inflation data

By Michele Maatouk

Date: Wednesday 17 Jul 2019

London open: Stocks edge lower as investors eye inflation data

(Sharecast News) - London stocks edged lower in early trade on Wednesday amid renewed concerns about Sino-US trade relations and ahead of the release of key UK inflation data.
At 0830 BST, the FTSE 100 was 0.2% lower at 7,564.68, while the pound was off 0.2% against the dollar at 1.2388 and 0.1% weaker versus the euro at 1.1054.

Relations between the US and China were in focus again after US President Trump said on Monday that the two countries have a "long way to go" to work out a trade deal and warned that he could slap tariffs on $325bn of Chinese goods if he wants.

Han Tan, market analyst at FXTM, said: "Investors who are hopeful of a US-China trade deal in the near-term have once again been reminded of the tremendous gulf that persists between the world's two largest economies. The path towards correcting US-China trade imbalances is still unclear, while the risk of more tariffs being placed on global trade remains on the table.

"Even though negotiations are set to resume in the near future, the ill-effects from the existing tariffs are already being felt in the global economy, as further evidenced by the dismal data out of key Asian economies in recent days. As long as the US-China trade tensions remain at current levels, markets will have scant reasons to push the risk dial significantly higher."

On home turf, market participants will be watching out for the release of the retail price index, producer price index and consumer price index, all due at 0930 BST.

In corporate news, Fresnillo was weaker as the precious metals miner cut its production targets for 2019, blaming lower-than-expected grades of ore grades and delays in construction work at the Herradura gold mine in Mexico.

Johnson Matthey was also in the red as it reaffirmed its full-year guidance but said that its clean air unit will see annual profits drop on the year.

On the upside, Burberry was the standout gainer for the second day in a row following a well-received first-quarter update on Monday.

BHP edged higher as it said iron ore output recovered in the fourth quarter after cyclone Veronica hit production in March, adding that output could grow by up to 6% in the 2020 financial year.

Builder Galliford Try rallied after saying that it expects annual pre-tax profit to be in line with the current range of analysts' expectations amid "good" housing demand, while GVC Holdings pushed higher as the Ladbrokes Coral owner posted double-digital online growth for the first half.

TalkTalk was also in the green after it reported a 1.3% rise in first-quarter revenue thanks to strong demand for fibre products, and backed its full-year guidance.

In broker note action, Hochschild Mining and Polymetal were started at 'sell' and 'hold', respectively, by Berenberg. Burberry was cut to 'underperform' at Jefferies, Experian was downgraded to 'reduce' at HSBC and Micro Focus was bumped down to 'sell' at Goldman Sachs.

Market Movers

FTSE 100 (UKX) 7,564.68 -0.17%
FTSE 250 (MCX) 19,645.98 -0.05%
techMARK (TASX) 3,679.71 -0.16%

FTSE 100 - Risers

Burberry Group (BRBY) 2,320.00p 1.89%
Rolls-Royce Holdings (RR.) 876.80p 1.27%
Imperial Brands (IMB) 2,069.00p 0.88%
British American Tobacco (BATS) 2,974.00p 0.76%
Ashtead Group (AHT) 2,306.00p 0.74%
Relx plc (REL) 1,978.50p 0.69%
Spirax-Sarco Engineering (SPX) 8,905.00p 0.68%
Intertek Group (ITRK) 5,656.00p 0.60%
Smith & Nephew (SN.) 1,765.50p 0.60%
Rentokil Initial (RTO) 421.50p 0.55%

FTSE 100 - Fallers

Fresnillo (FRES) 877.17p -4.78%
Johnson Matthey (JMAT) 3,290.00p -2.86%
Micro Focus International (MCRO) 1,652.20p -1.93%
BP (BP.) 534.20p -1.73%
Vodafone Group (VOD) 126.68p -1.09%
Antofagasta (ANTO) 911.40p -1.09%
Royal Dutch Shell 'B' (RDSB) 2,569.81p -0.95%
Royal Dutch Shell 'A' (RDSA) 2,570.00p -0.89%
International Consolidated Airlines Group SA (CDI) (IAG) 462.90p -0.86%
Glencore (GLEN) 270.65p -0.75%

FTSE 250 - Risers

TalkTalk Telecom Group (TALK) 108.58p 2.72%
TI Fluid Systems (TIFS) 197.80p 2.49%
Barr (A.G.) (BAG) 637.00p 2.25%
GVC Holdings (GVC) 622.00p 2.17%
Galliford Try (GFRD) 623.50p 2.05%
FirstGroup (FGP) 109.29p 1.48%
St. Modwen Properties (SMP) 424.50p 1.43%
Crest Nicholson Holdings (CRST) 365.14p 1.43%
Rotork (ROR) 311.20p 1.24%
EI Group (EIG) 207.40p 1.07%

FTSE 250 - Fallers

Hochschild Mining (HOC) 195.52p -3.88%
Premier Oil (PMO) 78.04p -3.61%
Computacenter (CCC) 1,299.00p -2.91%
Wood Group (John) (WG.) 513.60p -2.80%
Ted Baker (TED) 818.50p -2.33%
Tullow Oil (TLW) 204.30p -2.06%
Elementis (ELM) 130.90p -2.02%
Hays (HAS) 148.30p -1.79%
Hunting (HTG) 525.00p -1.78%
Ultra Electronics Holdings (ULE) 1,715.00p -1.78%


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