31st Aug 2018 08:42
LONDON (Alliance News) - London stock prices were broadly lower early Friday, as US-China trade war fears and lower housebuilder stocks were partly offset by a leap in Whitbread shares after its agreement to sell Costa to Coca-Cola.The FTSE 100 index was down 0.3%, or 25.18 points, at 7,490.11 early Friday. The mid-cap FTSE 250 index was flat, or down 4.24 points at 20,687.51. The AIM All-Share index was flat at 1,102.20.The Cboe UK 100 was down 0.4% at 12,690.24, the Cboe UK 250 was flat at 18,777.47, and the Cboe UK Small Companies was flat at 12,299.50.Sterling was quoted at USD1,3020 early Friday, slightly higher than USD1.3011 at the London equities close on Thursday, ahead of UK retail sales data at 0930 BST.UK house prices decreased at the fastest pace since mid-2012 in August, the Nationwide Building Society. House prices fell 0.5% on a monthly basis in August, in contrast to a 0.7% rise in July. This was the first drop in three months and the biggest monthly fall since July 2012. On a yearly basis, house price inflation slowed to 2.0% from 2.5% in July.FTSE 100 housebuilder stocks were lower following the bleak news, with Taylor Wimpey down 1.5%, Berkeley Group down 1.2%, and Persimmon and Barratt Developments both down 1.0%.However, Whitbread opened with a blast of steam, up 18% after announcing an agreement to sell its Costa Coffee business to The Coca-Cola Co for an enterprise value GBP3.9 billion, most of which will be returned to shareholders.The sale also will reduce debt, allow for an increased pension contribution and further expansion of hotel business Premier Inn in both the UK and Germany.The deal is subject to shareholder and regulatory approval, and is expected to be completed in the first half of 2019."Investors certainly appear to like the deal, not surprising given the pledge that most of the proceeds look set to be returned to shareholders, with the shares rising strongly on the open hitting their highest levels since December 2015," said Michael Hewson, chief market analyst at CMC Markets.Software company Sage Group started at the bottom of the blue-chip index, down 8.8% after announcing that Chief Executive Officer Stephen Kelly has stepped down from his role with immediate effect.He is to "remain available to the group" until May 31, 2019. Kelly has been chief executive of Sage for nearly four years since 2014.The group has started the process to find a new chief executive.Sage added that it has continued to trade in line with its guidance of 7.0% organic revenue growth and a 27.5% organic operating margin for the year to the end of September. However the group said that achieving this guidance would be dependent on the closing of several Enterprise Management opportunities in September.In the FTSE 250 index, John Laing Infrastructure Fund was up 0.1% after reporting strong results for the first half of 2018.Pretax profit for the six months to the end of June rose to GBP89.0 million from GBP34.7 million, on operating income that more than doubled to GBP96.3 million from GBP41.8 million.The fund said its GBP1.45 billion takeover by Jura Acquisitions will be conditional on 75% approval gained from shareholders at a court and general meeting, to both be held on September 24.OneSavingsBank opened at the bottom of the midcaps, down 2.2% after Credit Suisse cut its rating for the bank to Neutral from Outperform.In Asia on Friday, the Japanese Nikkei 225 index closed flat. In China, the Shanghai Composite closed down 0.6%, while the Hang Seng index in Hong Kong is down 1.0%.Overnight, Bloomberg reported that US President Donald Trump intends to move ahead with plans to impose tariffs on USD200 billion in Chinese imports.Trump has also threatened to pull the US out of the World Trade Organization if the international trading group does not "shape up"."Negativity sentiment stems from reports that President Trump is mulling tariffs on another USD200 billion of Chinese imports. He also threatened to abandon the WTO, rejecting an EU olive branch on auto tariffs (zero) while new-NAFTA trade negotiations with Canada remain deadlocked," said Michael van Dulken, head of research at Accendo Markets.The euro was quoted at USD1.1682 early Friday, lower from USD1.1692 at the European equities close Thursday.Germany's retail sales growth eased more than expected in July, figures from Destatis showed.Retail sales rose 0.8% year-on-year in July, slower than the 2.7% increase in June. Sales were expected to grow 1.3%. Nonetheless, this was the second consecutive increase.In mainland Europe, the CAC 40 in Paris was down 0.3% while the DAX 30 in Frankfurt was down 0.7% early Friday.The EU would abolish its tariffs on cars and industrial products if the US was willing to reciprocate, EU Trade Commissioner Cecilia Malmstrom said Thursday.While the move appeared to be in line with demands from President Donald Trump to have no barriers to trade, the US leader was quick to dismiss the proposal as "not good enough", in an interview with Bloomberg News just hours later.Related Shares:
JLG.LSage GroupBarratt DevelopmentsOneSavings BankPersimmonWhitbreadTaylor Wimpey