US-China trade tensions begin to ease

LONDON’S top-flight stocks were bolstered by a weaker pound and upbeat global markets on Friday, as progress appeared to be made in trade relations between the US and China.

The FTSE 100 finished the day up by 133.41 points, or 1.95 per cent higher, at 6,968.33. It matched the mood of global stocks, which were lifted by reports that US Treasury Secretary Steven Mnuchin is discussing lifting some or all of the tariffs imposed on Chinese imports.

The move would ease tension ahead of meetings between the two sides which are scheduled for later this month. The news also helped push up oil prices, with a barrel of Brent crude oil trading 2.21 per cent higher at 62.49 US dollars.

Fiona Cincotta, senior market analyst at City Index, said: “The prospect of tariffs being reduced on China, crude’s largest importer, kept buying interest in oil, whilst signs that the OPEC output cut had begun was also supportive to the price. However, gains in oil were capped after the International Energy Agency warned over slowing demand owing to a slowing global economy and rising US output as US shale companies up production.”

In Europe, the German Dax rose 2.63 per cent and the French Cac was up 1.7 per cent.

The FTSE 100 was also boosted by

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the weaker pound, which was still weighed on by the uncertainty over Brexit. Sterling was down 0.43 per cent against the euro at 1.134 and 0.7 per cent lower versus the US dollar at 1.289.

The market’s buoyancy came despite gloom in the airline sector following Ryanair’s profit warning on Friday morning. The Irish carrier lowered its full-year post-tax profit guidance from between 1.1 billion euros (£966 million) and 1.2 billion euros (£1 billion) to a new range of one billion euros (£878 million) and 1.1 billion euros (£966 million).

Easyjet suffered from the effects of the announcement. The stock was held back from making the same gains as its fellow FTSE 100 companies, climbing just 3p to 1,172p.

Meanwhile Eddie Stobart Logistics saw sales race ahead last year as the road haulier was boosted by new contract wins. The firm posted a 35 per cent rise in full-year revenue to £843 million in the 12 months to November 30.

The top risers on the FTSE 100 were Ashtead up 84p to 1,953p, Melrose Industries up 7.2p to 169.55p, GVC Holdings up 27.5p to 714.5p and Morrisons up 8.8p to 230.65p.

The biggest fallers on the FTSE 100 were Ocado down 17.2p to 883p, Fresnillo down 13.2p to 887.6p and Hikma Pharmaceuticals down 2.5p to 1,547.5p.