Talk of more trade tariffs hits markets
Concern over the prospect of further trade tariffs being imposed in the dispute between the US and China took its toll on the markets.
The FTSE 100 closed 64.32 points lower at 7,318.96 with Germany’s Dax and France’s Cac 40 in France also in the red.
The fall in London came despite energy firms being boosted after the regulator showed more restraint than expected with its price cap.
Ofgem said it would impose a price cap of £1,136 on dual fuel customers paying by direct debit, forcing suppliers to cut prices to that level or below.
However, the cap was more lenient than analysts had been expecting, with some of the most pessimistic predicting a cap of £1,120.
The news helped the likes of British gas owner Centrica, which closed 5 per cent higher at 150.55p. Meanwhile, Perth-based SSE and United Utilities were up by 0.4 per cent and 1.5 per cent respectively.
Russ Mould, investment director at AJ Bell, said: “Ofgem has shown its teeth but perhaps not bitten quite as hard as it could have.
“Its report now means that the utilities – and investors – know exactly where they stand and, as the biggest two suppliers in the retail UK electricity market, Centrica and SSE may be particularly relieved.”
Melrose Industries swung to a half-year loss after booking hefty costs linked to its controversial £8 billion hostile takeover of engineering giant GKN but shares rose 7.3p to 230p. Dixons Carphone, which is still reeling from a massive customer data breach, fell 2.6p to 161.55p as it posted first-quarter results.