5th Jul 2018 11:57
LONDON (Alliance News) - London stocks on Thursday were continuing to climb at midday, ahead of Friday's impending tariff deadline.A Chinese commerce official had said that Beijing will not "fire the first shot" in the trade war but instead counter Washington's measures with equal force.Each country is set to enact tariffs on imports worth USD34 billion from the other country on Friday. However, as Beijing is 12 hours ahead of Washington, the expectation has been that the Chinese tariffs would go into effect first.Gao Feng, a spokesman for the Chinese Commerce Ministry, told reporters Thursday that will not be the case."The US has provoked this trade war," Gao said. "We are not willing to fight, but in order to safeguard the interests of the country and the people, we have to fight if necessary."The FTSE 100 index was up 0.5%, or 37.47 points, at 7,610.56. The mid-cap FTSE 250 index was up 0.1%, or 16.92 points, at 20,669.43. The AIM All-Share index was up 0.2% at 1,082.62.The Cboe UK 100 was up 0.6% at 12,899.17, the Cboe UK 250 was up 0.2% at 18,883.81, and the Cboe UK Small Companies was up 0.2% at 12,615.37.The pound was quoted at USD1.3257 at midday, up from USD1.3218 late Wednesday.Bank of England Governor Mark Carney on Thursday said incoming data has given him "greater confidence" that soft UK activity in the first quarter of 2018 was largely due to snow and icy weather.Speaking at the Northern Powerhouse Business Summit on Thursday, Carney said: "A number of indicators of household spending and sentiment have bounced back strongly from what increasingly appears to have been erratic weakness in the first quarter.""The UK labour market has remained strong, and there is widespread evidence that slack is largely used up. Pay and domestic cost growth have continued to firm broadly as expected. Headline inflation is still expected to rise in the short term because of higher energy prices," he added.Recent data from the UK suggests that the economy is evolving largely in line with the central bank's May Inflation Report projections, Carney said.In mainland Europe at Thursday midday, the CAC 40 in Paris was up 1.0% while the DAX 30 in Frankfurt gained 1.3%.The International Monetary Fund on Thursday lowered its growth forecast for Germany to 2.2% in 2018 from 2.5%, citing the possibility of a hard Brexit and rising protectionism. Other reasons for slowing growth were a reduced appetite for investment across the eurozone and, as a result, lower export figures for Germany.Stocks in New York were called for a higher open on Thursday, re-opening from Wednesday's Independence Day holiday. The Dow Jones and S&P were seen opening 0.6% higher, while the Nasdaq was set to gain 0.7%.In the economic calendar on Thursday, there is US ADP employment change at 1315 BST followed by initial and continuing jobless claims at 1330 BST. The Markit composite PMI is at 1445 BST, with the ISM non-manufacturing PMI at 1500 BST.The minutes from the latest Federal Open Market Committee will be released at 1900 BST."[The minutes] are broadly expected to show an upbeat view of the US economy and potentially confirm that the Fed may stay the course on its rate setting agenda. But markets could still end up being disrupted by central bankers' comments about the impact of the tariff wars between the US and its major trade partners," said Fiona Cincotta, senior market analyst at City Index.In London at midday, miner Glencore was up 3.1% after it set out plans for a USD1 billion buyback. Glencore is to buy GBP350 million in stock back from shareholders up to August 7, and will then go ahead with further buybacks.This comes after the commodities trader on Tuesday said it received a subpoena from the US Department of Justice to produce documents in compliance with the Foreign Corrupt Practices Act and US money laundering law, with the stock still 9% lower in the week-to-date."Following the recent weakness in shares the buyback should provide an element of support through an increasingly volatile period," said Tyler Broda, an analyst at RBC Capital Markets.At the bottom of the blue-chip index was Associated British Foods, down 4.6% after it left its annual outlook unchanged but was downbeat on sugar pricing next year.For the full-year, AB Foods said it expects good profit growth in Grocery, Agriculture and Ingredients. However, the company now expects reduced profit from AB Sugar due to lower EU sugar prices, but increased profit from low-cost fashion chain Primark driven by higher margins.For the third quarter, AB Sugar revenue was down 17%, as expected. This was "entirely the result of significantly lower EU prices which adversely affected our UK and Spanish businesses", the company said.AB Foods continued: "EU sugar prices are continuing to decline driven by low world sugar prices and excess supply following very high sugar production in the EU last year. For our next financial year, this level of EU sugar prices would represent a substantial reduction compared to those achieved this year. As a result, our expectations for sales and profit at AB Sugar, both for this financial year and next, are lower than previously expected."The best performer in the FTSE 250 was Superdry, the retailer climbing 6.7% after it declared a special dividend.Superdry reported pretax profit of GBP65.3 million for the year ended April 28, down from GBP84.8 million made a year ago. Adjusted pretax profit grew by 12% to GBP97.0 million, as revenue rose by 16% to GBP872.0 million.The company declared annual dividend of 31.20 pence per share, up 11%, as well as a special dividend of 25.00p.Electrocomponents was up 2.0% after the company said it has made a strong start to its financial year, with double digit revenue growth and improved profitability.The electrical products distributor said first quarter like-for-like revenue rose 10%, with all five regions in which the company operates seeing good growth in the three months to June 30. The Americas was the fastest growing segment, with like-for-like sales growing 13%, driven by market share gains in a "strong underlying market".Stuck at the bottom of the mid-cap index was Sophos, having pared some earlier losses to be quoted 17% lower at midday.The cyber security firm saw lower than anticipated billings growth in the first quarter, up just 6%, or 2% higher at constant currencies. The lower billings were driven by its Enduser security business, which faced a "particularly challenging comparable"Elsewhere on the Main Market, Enquest was up 7.1% after Barclays raised the oil and gas company to Overweight from Underweight.Related Shares:
ECM.LEnquestGlencoreSophos GroupAB FoodsSDRY.L