Wednesday 20 June 2018

Traders remain cautious amid US-Russia stand-off over Syria

Donald Trump has not yet taken action against the Assad regime for its alleged chemical attack.

Donald Trump has warned Russia that he will conduct airstrikes on Syria (Matt Cardy/PA)
Donald Trump has warned Russia that he will conduct airstrikes on Syria (Matt Cardy/PA)

By Helen Cahill, Press Association City Reporter

London’s blue chip index edged up on Friday as traders remained cautious amid simmering tensions between Russia and the US over Syria.

US president Donald Trump has warned Russia that he is preparing air strikes against Syria, but has not yet taken action. Prime Minister Theresa May has also won approval from the Cabinet to take action against Syria.

On Friday, the FTSE 100 closed higher by 6.22 points or 0.09% to 7,264.6, while Germany’s Dax was up by 0.22% and France’s Cac 40 was up by 0.11%.

David Madden, market analyst at CMC markets, said market confidence had not fully returned after Mr Trump told the Kremlin to “get ready” for an attack on Syria.

“The Syrian situation is still at the forefront of traders’ minds. Russia remains in the US’ bad books, and the possibility of a trade war is still simmering away in the background,” he said.

“Until these issues have been resolved, investors are likely to remain cautious about being long.”

There were no key economic announcements in the UK on Friday, but the pound climbed against the dollar, and was up by 0.16% to 1.425.

Sterling also strengthened against the euro, rising by 0.17% to 1.156.

In oil markets, Brent crude prices pushed 0.75% higher to 72.68 dollars a barrel, with rises fuelled by tensions in the Middle East.

In UK stocks, Sage Group’s shares plummeted after the software firm revised down its forecast for annual sales, following a poor first half. Shares fell by 55p to 617p during the day’s trading.

London Stock Exchange Group’s shares were up by 32p to 4,270p after the company said on Friday that it has appointed Goldman Sachs veteran David Schwimmer as its new chief executive.

Mr Schwimmer, 49, will join the LSE on August 1 and will replace the long-standing Xavier Rolet, who left the firm last year in controversial circumstances.

Burberry also updated the market on a high-profile appointment, saying former Kingfisher chief executive Gerry Murphy would become its new chairman. Burberry’s shares closed the session 14.5p higher at 1,732.5p

He will succeed incumbent Sir John Peace, who has been in the role for 16 years, on May 17. Mr Murphy is also currently the chairman of Tate and Lyle and Blackstone’s European equity arm.

Hammerson’s share price fell after French property giant Klepierre said it was walking away from its £5 billion bid for the firm. Hammerson’s share price fell by 47p to 473p.

Klepierre said on Friday that its chairman Jean-Marc Jestin held a meeting with his Hammerson counterpart David Tyler on Monday to table a £5.04 billion proposal worth 635p per share.

However, following the meeting, it is walking away because Hammerson “did not provide any meaningful engagement”.

The biggest risers on the FTSE 100 were Whitbread up 126p to 3,935p, Micro Focus International up 40.5p to 1,299p, Mondi up 56p to 1,963p and GKN up 12.3p to 451.7p.

The biggest fallers were Sage Group, down 55p to 617p, EasyJet down 50p to 1,611p, Shire down 79p to 3,606.5p and Royal Mail down 10p to 560.8p.

Press Association

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