LONDON MARKETS: FTSE 100 Sags As North Korea-U.S. Tensions Flare Up
September 22 2017 - 4:51AM
Dow Jones News
By Carla Mozee, MarketWatch
U.K. Prime Minister to speak about Brexit in Italy
Stocks in the U.K. fell Friday, dragged lower by a flareup in
tensions between the U.S. and North Korea, but the benchmark FTSE
100 was on course to break a run of weekly losses.
The FTSE 100 index fell 0.3% to 7,245.01, led by losses in the
basic materials and financial groups. But consumer-related shares
were among advancing sectors. The index on Thursday ended 0.1%
lower. A loss on Friday would be its third in a row.
The benchmark was still in line for a rise of 0.4% for the week,
which would be its first weekly win in three.
But equities in London and across Europe sagged after North
Korea's foreign minister warned that it may test a hydrogen bomb
over the Pacific Ocean in response to U.S. President Donald Trump's
threat to "totally destroy North Korea" if Pyongyang provoked the
U.S. or its allies. Trump on Thursday ordered expanded sanctions
North Korea, targeting individuals or companies trading with the
country.
Read:Kim Jong Un calls Trump a 'mentally deranged U.S. dotard'
(http://www.marketwatch.com/story/kim-jong-un-calls-trump-mentally-deranged-us-dotard-setting-off-scramble-for-dictionaries-2017-09-21)
"Needless to say, these comments have caused a degree of risk
off in the markets with safe-havens benefiting," said analysts at
FXPro in a note.
As gold prices caught haven bids, shares of gold producers
Fresnillo PLC (FRES.LN) and Randgold Resources PLC (RRS.LN)
(RRS.LN) rose 0.8% and 0.2%, respectively. Those stocks
outperformed others in the mining group. Stock in Anglo American
PLC (AAL.LN) fell 1.9% and Glencore PLC (GLEN.LN) lost 1.6%.
Iron ore heavyweight BHP Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU)
fell 2.2% and rival Rio Tinto PLC (RIO) (RIO) (RIO) lost 0.8% even
as the company said it's starting an additional $2.5 billion share
buyback program
(http://www.marketwatch.com/story/rio-tinto-to-start-25-bln-share-buyback-plan-2017-09-22).
Rio is returning proceeds from the sale of Coal & Allied to
shareholders.
May in Florence: U.K. Prime Minister Theresa May will be back in
the spotlight Friday as she's scheduled to deliver a speech about
Brexit in Florence, Italy. May was set to offer EUR20 billion to
the European Union (http://www.bbc.co.uk/news/uk-politics-41342580)
for access to the bloc's single market during a transition period
after the U.K. leaves the EU, according to BBC News. May was also
expected to outline a plan to offer certainty to citizens and
businesses affected by Brexit.
May was slated to speak at 3:15 p.m. local time, or 2:15 p.m.
London time. Ahead of her appearance, the pound was buying $1.3580,
little changed from $1.3582 late Thursday in New York.
The pound rose above $1.35 on Thursday on reports that May will
assert a 'soft Brexit' tone in Florence. "If the markets like what
they hear and there isn't a negative response from [U.K.]
counterparts then we could see further gains for the pound," said
FairFX in a note.
Stock movers: Smiths Group PLC (SMIN.LN) dropped 4.7% as the
technology company said its energy-engineering division, John
Crane-- which accounts for about a quarter of group revenue --
continued to face challenges
(http://www.marketwatch.com/story/smiths-group-pretax-profit-soars-on-wider-margins-2017-09-22)
. Overall, Smiths logged a 74% rise in pretax profit for fiscal
2017.
(END) Dow Jones Newswires
September 22, 2017 04:36 ET (08:36 GMT)
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