2nd Aug 2018 08:53
LONDON (Alliance News) - Stocks in London opened lower on Thursday with heavyweight mining stocks weighing on the FTSE 100, as trade war fears continued to plague financial markets across Europe and Asia.The FTSE 100 index was down 0.5%, or 38.72 points, at 7,614.19 early Thursday. The mid-cap FTSE 250 index was down 0.5%, or 101.00 points at 20,700.47. The AIM All-Share index was down 0.2% at 1,093.53.The Cboe UK 100 was down 1.8% at 12,924.81, the Cboe UK 250 was down 0.3% at 18,840.14, and the Cboe UK Small Companies was down 0.2% at 12,342.90.In mainland Europe, the CAC 40 in Paris was down 0.5% while the DAX 30 in Frankfurt was down 1.1% early Thursday."The FTSE dropped another half a percent after the bell, a second day of trade war-inspired commodity woes forcing the UK index back to its worst price in more than a fortnight," said Spreadex analyst Connor Campbell.The US trade representative said Wednesday that US President Donald Trump has ordered him to consider increasing from 10% to 25% the proposed level of additional duty on USD200 billion worth of Chinese goods.US Trade Representative Robert Lighthizer said in a statement the higher duty would be applied to a proposed list of products announced on July 10.Anticipating the announcement, Beijing promised earlier Wednesday to retaliate.On the London Stock Exchange, Rolls-Royce was the best performer at the open, up 4.1% after the jet engine maker said it expects underlying profit and cash flow for 2018 to be in the upper half of its guidance range. For the six months ended June 30, revenue rose 12% to GBP7.49 billion from GBP6.66 billion the year before. However, Rolls-Royce swung to a pretax loss of GBP1.26 billion from a GBP1.44 billion profit last year, as the company was hit by an exceptional charge of GBP554 million relating to its well-publicised problems with the Trent 1000 engine. However, Rolls-Royce swung to an underlying operating profit of GBP141 million from a GBP84 million loss last year. London Stock Exchange was up 1.8% after the stock exchange operator reported a strong first-half performance.For the half year ending June 30, revenue was up 11% to GBP953 million from GBP853 million the year before and total income rose 12% to GBP1.06 billion from GBP946 million prior. Pretax profit was surged to GBP360 million from GBP277 million last year. LSE raised its interim dividend 19% to 17.2p from 14.4p the year before."The group has delivered a strong financial performance in the first half, with revenue growth across our businesses as we invest further to drive further sales growth and operating efficiencies. We remain well positioned in an evolving regulatory and macroeconomic environment and remain focused on achieving the 2019 financial targets," said Chief Financial Officer David Warren. Conversely resource stocks were weighing on the large-cap index amid heightened trade fears. Russian steelmaker Evraz was down 2.5%, Anglo-Australian miners BHP Billiton and Rio Tinto were down 2.4% and 2.2%, respectively, Chilean miner Antofagasta was down 2.2%, and Anglo American was down 2.0%. The pound was lower against the dollar quoted at USD1.3075 early Thursday, compared to USD1.3117 at the London equities close Wednesday, ahead of the Bank of England's interest rate decision at midday. Economists are expecting an interest rate rise from the BoE, after UK economic data have held up in recent months, although a hike has been largely priced in by investors.The BoE will announce its latest monetary policy decision, alongside the release of the Monetary Policy Committee meeting minutes and Quarterly Inflation Report, at midday on Thursday in London, on what has come to be known as 'Super Thursday'.This will be followed by a press conference with BoE Governor Mark Carney at 1230 BST.The BoE raised interest rates for the first time in a decade in November 2017, lifting the Bank Rate off its historic low of 0.25% to 0.50%. Thursday's decision is expected to result in interest rates going to 0.75%.The international economic events calendar on Thursday has UK construction PMI data at 0930 BST, eurozone producer prices at 1000 BST and US factory orders at 1500 BST.The euro was marginally lower quoted at USD1.1629 early Thursday, from USD1.1662 at the European equities close Wednesday.In the US on Wednesday, Wall Street ended broadly lower, with the Dow Jones Industrial Average down 0.3%, S&P 500 down 0.1% and Nasdaq Composite up 0.5%.The US economy is strong enough to bear tighter monetary policy on the horizon, the Federal Reserve said late Wednesday, even as the central bank left its benchmark interest rate unchanged in a target range of 1.75% to 2.00%.The Fed's monetary policy committee said it expects that "further gradual increases" in the target range will be "consistent with sustained expansion of economic activity, strong labour market conditions and inflation near the committee's symmetric 2% objective over the medium term."In a statement, the Fed said that risks to the outlook for the US economy seem "roughly balanced".The Japanese Nikkei 225 index closed down 1.0%. In China, the Shanghai Composite closed down 2.1%, while the Hang Seng index in Hong Kong is down 2.3%.Related Shares:
Anglo AmericanLSE.LRio TintoBHP Billiton PLCEvrazAntofagastaRolls-RoyceAntofag.5%pr