London close: Stocks drop amid trade jitters
London stocks finished the week at their session lows as the White House's pledge to slap tariffs on imports of steel and aluminium reverberated around the world.
It was against that backdrop that the Prime Minister called in her speech on both Brussels and the more hardline Brexiteers in her own Cabinet to show flexibility.
"We need to resolve the tensions between some of our key objectives. We both need to face the fact that this is a negotiation and neither of us can have exactly what we want," May said in her speech in London.
The FTSE 100 finished down by 1.47% or 105.74 points to 7,069.490, although the pound was steady, edging lower by only 0.03% versus the dollar to 1.3772 albeit by a larger 0.45% against the euro to 1.1180.
Across the Channel, the Dax fared even worse, shedding 2.27% or 277.23 points to trade at 11,913.71. On Wall Street, on the other hand, stocks were in fact mixed, although the exporter-laden Dow Jones Industrials as trading lower by 0.7%.
At a meeting with American steel and aluminium producers overnight, Trump said he plans to sign off on measures next week to protect US companies, though domestic manufacturers said the tariffs would drive up prices.
CMC Markets analyst Michael Hewson said: "25% tariffs on steel and a 10% tariff on aluminium imports has raised concerns of counter-measures from China and the EU."
Indeed, perhaps the biggest worry of policymakers around the world since the Great Financial Crisis had been that countries would fail to avoid observe the chief lesson of the Great Depression of 1929, which was widely-considered to have been triggered by spiralling trade spats in the aftermath of the Great War.
On the economic front, the latest survey from IHS Markit showed UK construction companies reported little easing in subdued trading conditions, with confidence near five-year lows in February and the sector on track for a fourth consecutive quarter of reduced output.
The UK construction purchasing managers' index rose to 51.4 from the 50.2 four-month low from January, beating average of economist predictions for a modest rise to only 50.5.
Construction companies indicated that business confidence was at "one of the lowest levels seen in the past five years", Markit said.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: "Output in the construction sector remains on course to contract for a fourth consecutive quarter, despite the modest rise in the PMI in February. In practice, any PMI reading below 52 has been consistent with falling construction output in the past."
In corporate news, South African packaging and paper group, Mondi, was on the front foot after saying it will pay out a bumper special dividend on top of its healthy payout for last year as it reported growth of 7% in revenues and 6% in underlying operating profits.
London Stock Exchange Group on the other hand was in the red despite saying that full year operating profits rose 47% to £626m, while adjusted operating profit was up 18% to £812m.
Spire Healthcare also lost ground as it posted a 69% drop in full-year pre-tax profit and announced the departure of chief finance officer Simon Gordon, after seven years in the role.
Takeaway food delivery marketplace Just Eat was also lower as it announced that its board has appointed Mike Evans to the role of non-executive chairman, with effect from 26 April.
Johnson Matthey declined as it appointed Jason Apter as sector chief executive of its health division.
Engineering group IMI slid even as it said full year pre-tax profits rose 9.4% to £180.9m as new products drove an improved performance in what it called a “mixed” trading environment.
ConvaTec was weaker after announcing the acquisition of Texas-based catheter-related supplies distributor J&R Medical for an undisclosed sum.
Similarly, GKN lost ground after the engineer, which is currently fending off a £7.4bn hostile by from turnaround specialist Melrose Industries, confirmed that it has engaged in talks with US-based Dana about a potential sale of its automotive division, Driveline, as part of a deal which would be effected mainly in equity.
Land Securities slipped after saying that chairman Alison Carnwath would retire from the board in 2018 after nine years in the role, while Essentra was trading lower after the release of its 2017 results.
In broker note action, Merlin Entertainment was lifted to 'hold' by Berenberg, while Moneysupermarket was upgraded to 'buy' at Peel Hunt.
Market Movers
FTSE 100 (UKX) 7,069.90 -1.47%
FTSE 250 (MCX) 19,386.54 -0.84%
techMARK (TASX) 3,286.16 -0.96%
FTSE 100 - Risers
Mondi (MNDI) 1,911.00p 3.86%
Rentokil Initial (RTO) 272.50p 3.57%
Randgold Resources Ltd. (RRS) 5,940.00p 3.02%
Burberry Group (BRBY) 1,643.00p 2.67%
Associated British Foods (ABF) 2,620.00p 0.85%
Bunzl (BNZL) 1,955.00p 0.72%
Fresnillo (FRES) 1,197.50p 0.67%
Taylor Wimpey (TW.) 186.05p 0.65%
Barratt Developments (BDEV) 533.60p 0.64%
Hammerson (HMSO) 447.90p 0.47%
FTSE 100 - Fallers
Rio Tinto (RIO) 3,647.50p -3.76%
Old Mutual (OML) 246.00p -3.45%
GKN (GKN) 420.00p -3.45%
Tesco (TSCO) 202.00p -3.16%
Anglo American (AAL) 1,687.60p -3.10%
BHP Billiton (BLT) 1,412.60p -3.10%
Royal Bank of Scotland Group (RBS) 257.60p -3.05%
Glencore (GLEN) 364.50p -3.02%
Barclays (BARC) 205.75p -2.82%
Croda International (CRDA) 4,464.00p -2.73%
FTSE 250 - Risers
Essentra (ESNT) 474.80p 7.87%
Acacia Mining (ACA) 141.10p 5.69%
Howden Joinery Group (HWDN) 501.20p 4.35%
Drax Group (DRX) 264.00p 4.35%
Petrofac Ltd. (PFC) 441.40p 2.96%
FDM Group (Holdings) (FDM) 865.00p 2.84%
TalkTalk Telecom Group (TALK) 102.70p 2.61%
Softcat (SCT) 597.00p 2.40%
Hunting (HTG) 692.00p 2.30%
Greggs (GRG) 1,215.00p 2.10%
FTSE 250 - Fallers
IMI (IMI) 1,124.00p -8.54%
Stagecoach Group (SGC) 130.00p -8.20%
Merlin Entertainments (MERL) 351.60p -5.48%
Galliford Try (GFRD) 833.00p -4.86%
Inmarsat (ISAT) 455.40p -4.63%
Morgan Advanced Materials (MGAM) 320.00p -4.25%
Weir Group (WEIR) 1,899.50p -4.11%
Kier Group (KIE) 979.00p -4.02%
Bodycote (BOY) 883.50p -3.92%
Jardine Lloyd Thompson Group (JLT) 1,288.00p -3.88%