London open: Stocks flat as US threatens more sanctions on Turkey
London stocks were steady in early trade on Friday as there was little domestic news flow to distract investors from focusing on the latest developments in Sino-US relations and Washington's threat of more economic sanctions on Turkey.
At 0820 BST, the FTSE 100 was flat at 7,557.69, while the pound was unchanged against the dollar and the euro at 1.2717 and 1.1175, respectively.
White House economic advisor Larry Kudlow confirmed overnight that the US and China will resume trade talks later this month, but he also cautioned that President Trump is committed to making sure the administration gets a good deal.
"The Chinese government, in its totality, must not underestimate President Trump's toughness and willingness to continue this battle to eliminate tariffs and non-tariff barriers and quotas, to stop the theft of intellectual property and to stop the forced transfer of technology," Kudlow said in an interview with CNBC. "Those are the asks that we've been making now for quite some time."
CMC Markets analyst David Madden said: "It is worth remembering that this was only the confirmation of talks restarting, and there is no guarantee that any trade deal will be reached. Trade discussions have a history of being protracted, and just because traders want a trade deal doesn’t mean they will get one."
Investors were also likely to be feeling a little wary after US Treasury Secretary Mnuchin signalled a more hard-line approach to Turkey, saying that the US could impose more sanctions on the country if President Erdogan refuses the quick release of the American pastor at the heart of the Turkey crisis.
"We put sanctions on several of the Cabinet members," Mnuchin said Thursday during a Cabinet meeting at the White House. "We have more that we’re planning to do if they don’t release him quickly."
Things were pretty quiet on the UK corporate front, with defensive stocks leading the blue chip gains.
Royal Bank of Scotland nudged higher as it confirmed that chief financial officer Ewen Stevenson will step down from the board on 30 September, after he resigned in May. Katie Murray, his current deputy CFO, will become interim CFO while Stevenson's permanent successor is sought.
TI Fluids Systems was little changed after announcing a 2.7p a share dividend to be paid on 28 September.
Outside the FTSE 350, Interserve rallied as a consortium led by the support services and construction group won a £105m project for Durham University.
Waste management company Biffa also racked up healthy gains as it announced the acquisition of waste and recycling solutions group Weir Waste Services for £16.2m.
On the broker note front, RBS was upgraded to 'buy' at HSBC, while Esure was lifted to 'equalweight' at Barclays and Glencore was boosted to 'hold' at Liberum.
On the downside, Kaz Minerals was cut to 'neutral' at Credit Suisse and Spirax-Sarco was downgraded to 'sell' at Investec.
Market Movers
FTSE 100 (UKX) 7,557.69 0.02%
FTSE 250 (MCX) 20,427.03 -0.17%
techMARK (TASX) 3,549.77 0.09%
FTSE 100 - Risers
BT Group (BT.A) 227.43p 0.74%
Reckitt Benckiser Group (RB.) 6,820.00p 0.69%
Coca-Cola HBC AG (CDI) (CCH) 2,649.00p 0.68%
Royal Bank of Scotland Group (RBS) 242.10p 0.62%
National Grid (NG.) 829.10p 0.56%
British American Tobacco (BATS) 4,177.50p 0.47%
Unilever (ULVR) 4,428.00p 0.39%
Associated British Foods (ABF) 2,315.00p 0.35%
United Utilities Group (UU.) 750.90p 0.33%
Vodafone Group (VOD) 177.55p 0.31%
FTSE 100 - Fallers
Kingfisher (KGF) 268.20p -2.30%
Randgold Resources Ltd. (RRS) 4,969.53p -1.24%
Antofagasta (ANTO) 834.20p -1.11%
Ashtead Group (AHT) 2,305.00p -0.73%
CRH (CRH) 2,524.00p -0.71%
Rightmove (RMV) 4,917.00p -0.69%
Evraz (EVR) 458.20p -0.67%
Melrose Industries (MRO) 218.30p -0.64%
Anglo American (AAL) 1,534.00p -0.58%
HSBC Holdings (HSBA) 699.40p -0.50%
FTSE 250 - Risers
AA (AA.) 118.50p 1.63%
Hikma Pharmaceuticals (HIK) 1,802.00p 1.52%
BTG (BTG) 516.00p 1.47%
Entertainment One Limited (ETO) 363.80p 1.39%
Just Group (JUST) 92.20p 1.32%
Card Factory (CARD) 179.20p 1.01%
Marshalls (MSLH) 488.00p 0.95%
F&C Global Smaller Companies (FCS) 1,442.80p 0.90%
Moneysupermarket.com Group (MONY) 286.20p 0.88%
WH Smith (SMWH) 1,982.00p 0.87%
FTSE 250 - Fallers
Kaz Minerals (KAZ) 537.60p -4.03%
Spirax-Sarco Engineering (SPX) 6,895.00p -3.63%
Victrex plc (VCT) 3,070.00p -2.42%
Countryside Properties (CSP) 320.40p -2.32%
Dunelm Group (DNLM) 498.43p -2.08%
Alfa Financial Software Holdings (ALFA) 162.00p -1.82%
Indivior (INDV) 277.60p -1.56%
Renishaw (RSW) 5,237.00p -1.37%
Travis Perkins (TPK) 1,112.00p -1.33%
RHI Magnesita N.V. (DI) (RHIM) 4,706.00p -1.18%