MARKET REPORT

EUROPEAN shares rallied yesterday as trade war fears cooled, but the boost was not enough to keep London’s topflight out of the red.

The FTSE 100 finished the day 1.87 points, or 0.03%, lower at 7,300.23.

The latest tit-for-tat between Washington and Beijing proved less aggressive than originally predicted, earlier in the morning, after the Trump administration revealed $200bn worth of tariffs on Chinese goods. The levy was set at 10%, rising to 25% in January. China then hit back with $60bn worth of tariffs on US imports, levied between 5%-10%.

“The move from China suggests they are in this for the long haul,” commented CMC Markets UK market analyst David Madden. “Washington DC are throwing their weight around in terms of tariffs, but Beijing could make life difficult for US companies operating in the country.

“Despite the initial negative reaction to Beijing announcing tariffs, stocks traded higher this afternoon.”

Mining stocks moved higher on the back of investor relief, with Glencore up 8.35p to 308.7p, Rio Tinto up 10.5p to 3,615.5p and BHP Billiton up 16.6p to 1,549.6p.

FTSE 100 online grocery group Ocado’s shares climbed as the company hit expectations for revenue growth in the third quarter.

The group said retail revenues rose 11.5% over its third quarter to September 2, which marks a slowdown on the 11.7% growth seen in its first half. Despite the slight pullback on growth, Ocado said it remained within its predicted growth range for the full year of between 10%15%. Shares in Ocado closed 7.2p higher at 919.8p.

The pound was flat against both the US dollar and the euro at 1.315 and 1.258 respectively.

Foreign exchange commentators see potential for the pound to have an upward run if the weakness in the US dollar persists.

“Sterling has the potential to appreciate sharply if the European Union adopts a flexible approach on Brexit at the European Union summit later this week,” said Lukman Otunuga, research analyst at FXTM.

The biggest risers on the FTSE 100 were Glencore up 8.35p to 308.7p, Evraz up 13.5p to 509.2p, Centrica up 3.9p to 149.35p and Anglo American up 29.6p to 1,576p.

The biggest fallers on the FTSE 100 were NMC Health down 110p to 3,436p, ITV down 4.75p to 153.25p, GVC down 23p to 972p and Relx down 32.5p to 1,538p.