ADVFN Morning London Market Report: Friday 2 March 2018

At 0830 GMT, the FTSE 100 was off 0.5% at 7,143.18, while the pound was flat against the euro at 1.1229 and down 0.1% versus the dollar at 1.3769.

Stocks on Wall Street ended down on Thursday after US President Donald Trump said he will impose steep tariffs on steel and aluminium imports, reviving worries of a trade war. At a meeting with American steel and aluminium producers, Trump said he plans to sign off on measures next week to protect US companies, though domestic manufacturers said the tariffs would drive up prices.

CMC Markets analyst Michael Hewson said: “25% tariffs on steel and a 10% tariff on aluminium imports has raised concerns of counter-measures from China and the EU.”

Jasper Lawler at London Capital Group said the decision spooked the markets overnight, successfully bringing treasury yields, the dollar and US indices tumbling lower and boosting the yen.

He added: “Market participants are waiting eagerly for Prime Minister Theresa May to lay out her vision for the post Brexit EU-UK relationship. Just a week ago expectations were rather different, with markets hoping to receive clarity from May to helping the Brexit process move forwards.

“However, in light of her flat out rejection of the draft Article 50 treaty, there is a growing fear that this landmark speech could drive a larger wedge between the two sides, pushing any possibility of a deal being reached further into the distance.”

On the data front, the construction purchasing managers’ index for February is at 0930 GMT. It is expected to have picked up slightly to 50.5 from 50.2 in January.

In corporate news, London Stock Exchange Group was in the red despite saying that full year operating profits rose 47% to £626m, while adjusted operating profit was up 18% to £812m.

Spire Healthcare lost ground as it posted a 69% drop in full-year pre-tax profit and announced the departure of chief finance officer Simon Gordon, after seven years in the role.

Takeaway food delivery marketplace Just Eat fell as it announced that its board has appointed Mike Evans to the role of non-executive chairman, with effect from 26 April.

Johnson Matthey declined as it appointed Jason Apter as sector chief executive of its health division.

Engineering group IMI slid even as it said full year pre-tax profits rose 9.4% to £180.9m as new products drove an improved performance in what it called a “mixed” trading environment.

ConvaTec was weaker after announcing the acquisition of Texas-based catheter-related supplies distributor J&R Medical for an undisclosed sum, while Essentra was trading lower after the release of its 2017 results.

On the upside, GKN gained after the engineer, which is currently fending off a £7.4bn hostile by from turnaround specialist Melrose Industries, confirmed that it has engaged in talks with US-based Dana about a potential sale of its automotive division, Driveline, as part of a deal which would be effected mainly in equity.

South African packaging and paper group, Mondi, was on the front foot after saying it will pay out a bumper special dividend on top of its healthy payout for last year as it reported growth of 7% in revenues and 6% in underlying operating profits.

Land Securities nudged up after saying that chairman Alison Carnwath would retire from the board in 2018 after nine years in the role.

Alfa Financial Software gained as it won a new contract with an unnamed global equipment manufacturer and finance group.

In broker note action, Merlin Entertainment was lifted to ‘hold’ by Berenberg, while Moneysupermarket was upgraded to ‘buy’ at Peel Hunt.

Travis Perkins was cut to ‘hold’ at Canaccord Genuity.