Investors gloss over fall-out from tough talk at G7

LONDON

THE FTSE 100 followed global stocks higher as investors shrugged off the fall-out from the weekend’s G7 meeting in Canada.

London’s blue chip index ended the day up 0.7% or 56.36 points at 7,737.43, while European peers including the French Cac 40 and German Dax rose 0.4% and 0.6% respectively.

It comes after a tumultuous G7 meeting in Quebec, which saw US President Donald Trump retract support for the summit’s final statement after trading barbs with fellow members over tariffs.

David Madden, a market analyst at CMC Markets UK, said: “Traders seem unfazed by the tough talk from President Trump. The markets are likely to stand their ground until there is a formal reaction from other members of the G7.

“Donald Trump is playing hardball, but he would probably settle for a compromise.”

Disappointing data in the UK, meanwhile, weighed on the pound. Sterling was down 0.15% against the US dollar at 1.337 and fell 0.13% versus the euro to 1.134.

Figures from the Office for National Statistics showed output in Britain’s manufacturing sector suffered its sharpest decline since 2012 in April, falling 1.4% month on month. It dragged on overall industrial output, which fell 0.8% in April.

In oil markets, Brent crude rose 0.3% to 76.63 US dollars per barrel, reversing earlier losses sparked by concerns about rising Russian production and US drilling. Worries over supplies from Iran and Venezuela supported oil price gains.

In UK stocks, Rolls-royce fell 2.6p to 832.8p on warnings it would be hit by costs linked to the discovery of technical issues found in another set of engines.

The company said it will carry out an inspection of the Package B engines, used by Boeing, but assured the problems will not prevent the company from hitting full-year financial targets.

HSBC shares were nearly flat, up just 0.1p at 730p, having recovered some losses felt in the wake of a strategy update yesterday. The bank said it will “simplify” the business, invest billions of pounds in tech and turn around its US division as part of new chief executive John Flint’s growth plans.

Away from the top tier, Inmarsat was the best performing stock on the FTSE 250, rising 60.1p to 534p.

The satellite telecoms company rejected a bid from US firm Echostar last week, prompting speculation it could start a bidding war for the British firm.

IG Design rose 9p to 445p after the gift maker reported a 51% rise in full-year profit to £19.7 million and a 5% rise in sales to £327.5 million, following an increased focus on Easter and Valentine’s Day.

The biggest risers on the FTSE 100 were Evraz up 37.6p at 537p, NMC Health up 132p at 3,566p, Marks and Spencer Group up 7.7p at 297.7p, and Standard Chartered up 19.1p at 745.7p.

The biggest fallers on the FTSE 100 were Old Mutual down 4.2p at 218.2p, Mediclinic International down 7.2p at 543.6p, Barratt Developments down 7p at 579p, and Severn Trent down 21.5p at 1,915.5p.

NEW YORK

US stocks ended slightly higher yesterday as investors shook off the weekend’s chaotic G7 summit ahead of a week packed with diplomatic events, and a pair of US Treasury Department auctions met with strong demand.

Investors’ bullishness on a positive outcome from today’s scheduled summit between U.S. President Donald Trump and North Korean leader Kim Jong Un helped the S&P 500 rise, led by gains in utility Sempra Energy.

Trump, in Singapore for the summit, said the historic meeting could “work out very nicely” as the countries try to narrow differences on how to end a nuclear standoff on the Korean peninsula. “No one expects anything concrete to come of the meeting ... but if the tone is positive afterwards, it won’t be a headwind for stocks,” said Ken Polcari, director of the NYSE floor division at O’neil Securities in New York.

The Dow Jones rose 5.78 points to 25,322.31, the S&P 500 gained 2.97 points to 2,782 and the Nasdaq Composite added 14.41 points to 7,659.93.

Sempra proved the biggest driver of the S&P’S rally, closing the day up 15.55 per cent to $117.20, after two key shareholders recommended six new directors for the company’s board and urged a strategic review of its business.

Also helping calm markets were comments from Italy’s new coalition government that it had no intention of leaving the euro.