London Markets: Resource stocks, travel names fall in London
U.K. stocks were under pressure Tuesday, with trade jitters weighing on mining stocks and a warning from Thomas Cook PLC hitting travel-related names.
Sterling weakness kept declines in check for the main index, as the currency fell over concerns about the recently agreed Brexit deal between the U.K. Prime Minister Theresa May and the European Union, helping international firms.
How are the markets performing?
The FTSE 100 UKX, -0.58% lost 0.3% to 7,013.07, after closing down 1.2% at 7,036 on Monday.
The pound GBPUSD, -0.4215% fell to $1.2755 from a close of $1.2811 in New York late on Monday.
What is driving stocks?
The pound tapped a 12-day low of $1.2728 after U.S. President Donald Trump reportedly suggested Monday that May’s Brexit deal could threaten a U.S.-U.K. trade agreement. Sterling weakness can be a lift for FTSE 100 stocks as many companies draw a chunk of their revenue in foreign currencies. Investors also remain concerned May will have trouble pushing the deal through parliament.
Resource stocks were under pressure as investors grew jittery ahead of the weekend trade meeting between the U.S. and China, a big user of natural resources. Tensions were elevated after Trump said in an interview with The Wall Street Journal that he was “unlikely” to hold off on higher tariffs for Chinese goods.
Travel and airline stocks were under pressure, with EasyJet PLC. EZJ, -2.22% down over 2%. Midcap Thomas Cook Group PLC TCG, -23.70% announced its second profit warning in two months and suspended its dividend after a summer heat wave in the U.K discouraged sun seekers from booking holidays aboard.
Google News, Bing News, Yahoo News, 200+ publications
Which stocks are active?
Heavyweight oil stocks drifted lower, on the heels of Monday’s rebound. BP PLC BP, -0.84% fell 0.5% and Royal Dutch Shell PLC RDS.A, -1.26% slipped 1%. Among miners, Rio Tinto PLC RIO, -2.32% RIO, -2.22% fell 2% and Glencore PLC GLEN, -1.34% GLEN, -1.34% dropped 1.6%.
Providing critical information for the U.S. trading day. Subscribe to MarketWatch’s free Need to Know newsletter. Sign up here.