Market Report

18th June 2018 at 5:07 pm

UK and European markets closed lower after President Donald Trump announced new tariffs against China.

U.S. stocks traded lower amid lingering trade tensions between the U.S. and China, the two largest economies in the world.

Anxiety about a global trade war spurred demand for the Japanese yen and Swiss franc, while the euro remained under pressure due to a dispute in Germany’s governing coalition and the European Central Bank seen holding interest rates into 2019.

Oil prices rose ahead of an OPEC meeting this week that is widely expected to increase global crude supply and as investors assessed the impact of a trade dispute between the United States and China.

Gold held close to 5-1/2 month lows, with a strong dollar offsetting the impact on prices of an escalating trade dispute between the United States and China.

In company news, Associated British Foods was on the rise after RBC Capital Markets lifted the stock to ‘outperform’ from ‘sector perform’ and bumped the price target up to 3,100p from 2,800p, citing potential for Primark’s like-for-like sales to improve.

On the downside, Ocado retreated as Bank of America Merrill Lynch cut the stock to ‘underperform’ from ‘buy’, saying the share price has factored in announced deals. The bank said that with the US market signed and no near-term plans to expand into a new continent – especially Asia – the debate on Ocado is shifting from licensing potential to execution. “We are not concerned and are changing our fundamental view. We still see Ocado’s technology as a unique grocery online solution. But the next three years are about delivering results and validating the economics rather signing new partnerships from one or two incremental customer fulfilment centres (CFCs).”

Rolls-Royce was under the cosh despite a rating upgrade from Credit Suisse, as it gave back some gains from last week, when investors welcomed news that it was set to exceed its target of £1bn in free cash flow by 2020.

Paper and packaging group DS Smith was also in the red even as it posted a 21% jump in full-year adjusted pre-tax amid growth in all regions. In the 12 months to 30 April, adjusted pre-tax profit rose to £473m, while revenue was also up 21%, to £5.77bn. The group said it benefited from the recovery of paper prices and growth from acquisitions, which more than offset input cost headwinds. In addition, currency translation effects also lent a hand.

 

Markets

At the close
FTSE 100 7,631 (-0.03%)
FTSE 250 20,999 (-0.03%)
DAX 12,834 (-1.36%)

At 16:57
Dow Jones 24,919 (-0.68%)
S&P 500 2,768 (-0.39%)
NASDAQ 7,733 (-0.16%)

 

Fixed Income
UK 10-YR YIELD 1.326 +0.07%

 

Exchange Rates
GBP/USD 1.324
GBP/EUR 1.141

 

Commodities
Gold $1,278 (-0.08%)
Brent $74.230 +1.63%