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London close: Stocks finish week on a low note amid Brexit and US-China talks

By Alexander Bueso

Date: Friday 20 Sep 2019

London close: Stocks finish week on a low note amid Brexit and US-China talks

(Sharecast News) - Big chip stocks finished the session and the weekly a tad lower as trading on Wall Street got off to a slightly volatile start, while the more domestic oriented shares on London's second-tier index managed to put in modest gains despite the mixed messages about the progress being made in Brexit negotiations.
The FTSE 100 was down 0.16% at 7,344.92, while the pound retreated 0.1% against the US dollar at 1.2521 and was up by a similar amount versus the euro to 1.1349.

It was a different story for the FTSE 250, which added 0.40% to 20,169.40.

Earlier, chief EU Brexit negotiator Michel Barnier said talks with the UK appear to have gone "backwards" after officials in Brussels received documents from Prime Minister Boris Johnson outlining ideas for a new deal.

Meanwhile, Irish Foreign Minister Simon Coveney told BBC Radio 4 that there was still a "wide gap" between the UK and the EU, alhough the "mood music" had improved.

Sterling had hit an 11-week high against the greenback earlier after European Commission president Jean-Claude Juncker said that a no-deal Brexit would be "catastrophic" and that he is doing everything he can to get a deal.

In an interview with Sky News on Thursday, Juncker said he was prepared to remove the backstop from a withdrawal agreement as long as "alternative arrangements" are put in place to achieve the main objectives of the backstop.

"I think we can have a deal," he said.

Nevertheless, as MUFG Bank's Derek Halpenny reminded clients Juncker's statement that "if the objectives are met, all of them, then we don't need the backstop" were in fact not new.

Halpenny conceded that "there might be something to those comments" and that the EU had sifted its position, but equally so, he said, they might just be part of an attempt by Brussels to deflect any criticism that it had not been flexible enough.

Sounding a similar note, David Cheetham, chief market analyst at XTB, questioned whether the pound had gone "too far, too fast".

On the trade front, talks between the US and China resumed, with Hu Xijin, editor-in-chief of Chinese state media Global Times, tweeting overnight that China was "not as anxious to reach a deal as the US side thought", with that comment serving to send the US dollar higher.

CMC Markets analyst David Madden said: "The update is neither encouraging nor worrying, but it shows that China are keeping their cards close to their chest, as they don't want to be seen to be very keen to strike a deal."

In equity markets, it was the more Brexit-sensitive shares of housebuilders and certain banks that put in the biggest gains, with Persimmon, Taylor Wimpey, Barratt Developments, Crest Nicholson, Bovis Homes, RBS and Lloyds all higher.

RBS was up as it confirmed the appointment of Alison Rose as its new chief executive officer. Rose, who will be the bank's first female CEO, is currently deputy CEO of NatWest Holdings.

Retailer Next advanced, clawing back some losses from the previous session when it slumped on the back of half-year results.

Engineer Smiths Group finished off its best levels of the session despite posting a jump in full-year profits and revenues, with all divisions apart from the detection business delivering growth.

Going the other way, Rolls-Royce was weaker after it warned airline customers of further disruption as it made changes to its Trent 1000 engine repair programme on the Boeing 787 Dreamliner, while Melrose Industries was knocked lower by a downgrade to 'sell' at Panmure Gordon.

Asset manager Investec slumped as it warned on profits at its UK banking business due to Brexit and global trade wars hitting fees and trading income. The company said headline earnings per share were expected to be 15% -18% lower year-on-year.

Market Movers

FTSE 100 (UKX) 7,344.92 -0.16%
FTSE 250 (MCX) 20,169.40 0.40%
techMARK (TASX) 3,888.72 -0.04%

FTSE 100 - Risers

Persimmon (PSN) 2,120.00p 4.43%
Kingfisher (KGF) 202.00p 3.64%
Burberry Group (BRBY) 2,203.00p 3.33%
Taylor Wimpey (TW.) 165.55p 3.02%
Next (NXT) 5,988.00p 2.89%
Morrison (Wm) Supermarkets (MRW) 203.90p 2.69%
Lloyds Banking Group (LLOY) 55.51p 2.68%
Royal Bank of Scotland Group (RBS) 213.50p 2.64%
Legal & General Group (LGEN) 252.80p 2.47%
International Consolidated Airlines Group SA (CDI) (IAG) 477.80p 2.33%

FTSE 100 - Fallers

Smith (DS) (SMDS) 345.10p -3.79%
Mondi (MNDI) 1,577.00p -2.56%
Unilever (ULVR) 4,795.00p -2.54%
BAE Systems (BA.) 573.80p -2.32%
Relx plc (REL) 1,857.50p -2.24%
Rolls-Royce Holdings (RR.) 792.80p -2.10%
Imperial Brands (IMB) 2,138.50p -2.08%
Johnson Matthey (JMAT) 3,100.00p -1.90%
DCC (DCC) 6,992.00p -1.89%
Coca-Cola HBC AG (CDI) (CCH) 2,632.00p -1.83%

FTSE 250 - Risers

Aston Martin Lagonda Global Holdings (AML) 617.40p 6.52%
Grafton Group Units (GFTU) 760.00p 5.48%
TBC Bank Group (TBCG) 1,312.00p 5.47%
TI Fluid Systems (TIFS) 207.50p 4.69%
4Imprint Group (FOUR) 3,130.00p 4.68%
JPMorgan Indian Investment Trust (JII) 716.00p 4.53%
FirstGroup (FGP) 135.10p 4.08%
Charter Court Financial Services Group (CCFS) 312.50p 3.95%
Countryside Properties (CSP) 330.80p 3.40%
William Hill (WMH) 189.90p 3.32%

FTSE 250 - Fallers

Investec (INVP) 451.40p -8.38%
Intu Properties (INTU) 38.66p -7.91%
Amigo Holdings (AMGO) 68.40p -7.48%
PureTech Health (PRTC) 266.00p -6.34%
Ted Baker (TED) 939.00p -6.10%
Cineworld Group (CINE) 230.10p -4.01%
Provident Financial (PFG) 424.20p -3.92%
Sanne Group (SNN) 576.00p -2.87%
Sirius Minerals (SXX) 4.25p -2.44%
Woodford Patient Capital Trust (WPCT) 46.70p -2.40%

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