FTSE holds despite frosty trade relations

The FTSE is just about trading in positive territory and unlike other European gauges it managed to hold its ground despite a weak close on Wall Street and heightened trade tensions between the US and China. The London index is being propped up by natural resources companies, utilities and oil producers helped by a further rise in oil prices. 

Dousing hopes that the latest frosting up in US-China trade relations will be resolved swiftly, Google suspended part of its business with Huawei after President Trump put the firm on a trade blacklist. Huawei has almost become a barometer of the state of the trade dispute because it touches on many of the sore points that the two sides were not able to agree on during the talks including China’s perceived disregard for privacy and forced transfer of technology.

Pound firms post Brexit talks breakdown

The pound firmed 31 pips against the dollar and 23 against the euro signalling that the market is not overly concerned by the breakdown in the Brexit talks between the Prime Minister and the Labour party, possibly hoping for a better outcome than the potential Brexit options that were put on the table by the two sides. 

Ryanair’s warning hits airlines

EasyJet, British Airways’ parent International Consolidated Airlines and TUI AG shares took a hit after Ryanair’s results reminded investors of the difficulties facing the travel sector, including high oil prices eroding the airlines’ margins. Brexit is also working its destructive magic on European airlines, already competing hard against one another in an overcrowded market. The Irish budget airline reported its weakest annual profit in four years and chief executive Michael O'Leary warned that results could become even worse later this year as the European aviation markets suffer from "attritional fare wars."

In the US it will be a bumper week for IPOs with three biotech companies due to come onto the market on Wednesday. All three cancer-focused companies Peloton Therapeutics, Ideaya Biosciences and Bicycle Therapeutics deal with different stages of cancer treatment and prevention.