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London open: Stocks nudge higher amid escalating Middle East tensions
London stocks nudged tentatively higher in early trade on Friday following a solid performance on Wall Street, with the mood tempered somewhat by escalating tensions between the US and Iran.
At 0840 BST, the FTSE 100 was up 0.1% at 7,432.44, while the pound was flat against the dollar at 1.2698 and 0.1% lower versus the euro at 1.1233.
In the US overnight, the S&P 500 hit a record closing high of 2,954.18 and recorded a new record intra-day peak on hopes that the Federal Reserve will cut interest rates soon.
But the mood in London was less buoyant as investors mulled a New York Times report late on Thursday that US President Trump had approved military strikes on several Iranian targets but then pulled back from launching the attacks.
On the data front, UK public sector net borrowing figures for May are due at 0930 BST.
In equity markets, Carnival was a high riser, having tanked late in the day on Thursday after the cruise operator downgraded its full-year earnings per share guidance, citing the US ban on cruises to Cuba.
Sports Direct was in the red after saying it would vote against the reappointment of the board at Goals Soccer Centres over the football pitch operator’s refusal to allow it to hire corporate investigator Kroll to look into a range of accounting issues at the troubled firm. Mike-Ashley-owned Sports Direct holds a 19% in Goals, which in March discovered that it owed more than £12m in unpaid tax. Its shares have been suspended.
Elsewhere, Halma shares were unchanged as it agreed to buy Ampac Group, a maker of fire detection systems in Australia and New Zealand, for AUD135m (£74m) in cash.
Meggitt fell even as it was awarded a multi-million dollar contract in the US by General Dynamics Land Systems to develop advanced cooling systems for next generation ground combat platforms.
Domino’s Pizza was the biggest loser on the FTSE 250. On Thursday, Sky News reported that Domino’s was in advanced talks to replace its chief executive David Wild, with Andrew Rennie – CEO for Europe at Domino’s Pizza Enterprises – the frontrunner to take over.
In broker note action, HSBC was weaker after a downgrade to ‘equalweight’ at Morgan Stanley and Weir was knocked lower by a downgrade to ‘hold’ at Liberum.
