London’s blue-chips opened Friday by scaling new heights, but the rally quickly lost steam as weak UK economic data and renewed trade war nerves dented sentiment.
The FTSE 100 notched a fresh record high of 8,984.14 shortly after the open, before easing back to 8,973.99, just a few points below Thursday’s close. The FTSE 250 slipped 0.3% to 21,629.12, while the AIM All-Share was flat.
Donald Trump’s escalating trade threats continue to cast a shadow. The US president issued another wave of tariff notices, targeting Canada with a 35% duty and threatening broader penalties for countries lacking trade agreements. With over 20 letters sent to global leaders this week, investors are bracing for further disruption.
Adding to the caution, UK GDP contracted 0.1% in May, according to the ONS, worse than the 0.1% growth forecast and compounding April’s 0.3% fall. Construction and manufacturing remained weak, while services eked out a marginal gain.
BP shares rose 2.4% after the oil giant upgraded its production outlook for the second quarter. It now expects upstream output to be higher quarter-on-quarter, reversing previous guidance for flat growth. However, the update came with caveats: softer commodity prices, impairments of up to $1.5 billion, and a sharp hit to realisations from its US and UAE operations.
Still, a strong oil trading result and better refining margins offered some offset. Brent averaged $67.88 per barrel in Q2, down from $75.73 in Q1.
In the mid-caps, SSP fell 5.5% after UBS cut the stock to ‘sell’, warning on valuation. On AIM, Accesso Technology plunged 27% after flagging first-half revenue at the low end of guidance due to disappointing visitor numbers at client venues.
The company remains optimistic for the crucial summer period, but investors were quick to punish the warning.