Fears over trade war hit London’s top-flight stocks

London’s top-flight stocks were under pressure yesterday amid yet more fears over a US-China trade war.

The FTSE 100 closed 1.24% or 95.85 points lower at 7,652.91, while the Cac 40 in France was down by 0.23% and the Dax in Germany was knocked 0.53%, after the Trump administration announced fresh plans for tariffs on Chinese goods.

Sterling was muted during the session following data showing that in July, Britain’s manufacturing sector grew at its weakest rate in 16 months.

In the afternoon, the pound was up 0.2% against the euro at 1.124. Sterling was flat against the dollar at 1.312.

Oil prices dived, with Brent crude down by as much as 2.24% to 72.512 US dollars a barrell, on the back of news of a spike in US oil inventories.

In markets, Direct Line said its boss Paul Geddes is to leave the insurance giant next summer after 10 years.

Mr Geddes said he had been “privileged” to lead the firm, with a tenure that saw him oversee Direct Line’s split from Royal Bank of Scotland and its stock market flotation. Shares closed 5.4p lower at 338.5p.

Dignity’s shares jumped by more than 3% or 39p to 1,051p as the funeral provider announced a £50 million turnaround plan and better than expected earnings on the back of a rise in deaths.

The company reported a 3% rise in revenue to £174.7m over the 26 weeks to June 29, while underlying operating profit fell 5% to £56.4m, which was higher than forecasts for £52.5m.