London open: US politics, global IT glitch trip up investors

Stocks in London were trading lower in early trading as investors digested the latest political headlines out of the US and their potential implications for the stock market.

Investors were also tripped up by a cascade of IT glitches involving software made by Microsoft and Crowdstrike that was impacting airlines and lenders globally, as well as the London Stock Exchange.

"At this stage, we do not know how long the outage will last and the cause is unknown. It is hard to see risk managing to stage a meaningful recovery in Europe or in the US until this has been resolved," said Kathleen Brooks, research director at XTB.

As of 0945 BST, the FTSE 100 was down by 0.52% at 8,162.53 points, alongside a 0.69% drop for the second-tier index to 21,086.97.

Stocks had fallen on Wall Street and in Asia on speculation about just how far the Federal Reserve would be able to cut interest rates should Donald Trump take the White House and what the effects of his tariff proposals would be.

"The effects of the Trump trade are not fully priced in markets according to our iFlow data," analysts at BNY Mellon mused.

"The yield curve could steepen further if we see evidence supporting the views of a Congressional sweep for Republicans and a Trump win."

There was also increasing speculation that the incumbent, president Joe Biden, might finally decide to sit out the next election.

"Of course, this political soap opera will unfold on X (formerly Twitter) and is likely to shift by the hour. There's chatter about Harris/Obama, then Hillary/Obama, and even Harris with some other Democrat," said Stephen Innes, managing partner at SPI Asset Management.

"What’s increasingly clear is that the Democratic Party is in disarray. But as I've said all along, and I’m not even on his side of the aisle, Biden has been a steadfast patriot, and regardless of your political leanings, this is a sad moment if the rumours hold."

On home shores, according to the Office for National Statistics UK retail sales fell at a month-on-month pace of 1.2% in June.

That was considerably worse than economists' forecast for a decline of 0.5%.

Data out from GfK overnight appeared to presage that result, with the consultancy's consumer confidence index improving by one point in July to -13.

Britons were reported to have taken a wait and see attitude following the elections.

In parallel, the UK public sector's net borrowing for last month was reported at £14.5bn, which was down from £17.8bn one year ago but above the £12bn anticipated by consensus.

LSE Group's RNS service knocked out

The London Stock Exchange's Regulatory News Service went haywire on Friday morning, close on the heels of an outage of US tech giant Microsoft's online services on Thursday evening. Other corporates across Asia, including in Japan, Hong Kong and India also reported outages with some of their software overnight.

The deadline for a potential £5.4bn takeover of Hargreaves Lansdown has been extended to 5 August, the fund supermarket confirmed on Friday. The FTSE 250 firm said last month it was minded to recommend a 1,140p per share offer from a private equity consortium led by CVC Capital Partners, after it rejected an earlier approach. Under Takeover Panel rules, the consortium was given until 19 July to make a formal offer or walk away, a so-called put up or shut up.

A joint venture half-owned by Segro has sold a portfolio of logistics warehouses in Italy for €327m (£275m), the company said on Friday. The portfolio consists of four warehouses, two located in Milan and two in Rome, and has a total floor space of 338,745 sq m generates a passing rent of €19m. The Segro European Logistics Partnership (SELP) is a joint venture in which Segro holds a 50% interest. It was established in October 2013 and owns €6.7bn of big box warehouses and development land across seven Continental European countries. Segro acts as its asset, property and development manager.

Market Movers

FTSE 100 (UKX) 8,154.78 -0.61%
FTSE 250 (MCX) 21,080.25 -0.72%
techMARK (TASX) 4,774.47 -0.51%

FTSE 100 - Risers

Rolls-Royce Holdings (RR.) 439.60p 1.15%
Marks & Spencer Group (MKS) 313.60p 1.00%
Centrica (CNA) 139.75p 0.65%
Convatec Group (CTEC) 252.60p 0.32%
BAE Systems (BA.) 1,281.00p 0.27%
Compass Group (CPG) 2,200.00p 0.23%
Auto Trader Group (AUTO) 803.40p 0.22%
Relx plc (REL) 3,476.00p 0.09%
British American Tobacco (BATS) 2,558.00p 0.08%
Darktrace (DARK) 583.40p 0.07%

FTSE 100 - Fallers

Spirax Group (SPX) 8,360.00p -6.75%
Fresnillo (FRES) 600.50p -3.84%
Beazley (BEZ) 649.50p -3.64%
Burberry Group (BRBY) 726.80p -3.35%
JD Sports Fashion (JD.) 117.00p -3.23%
Prudential (PRU) 700.80p -2.29%
Entain (ENT) 649.80p -2.23%
Glencore (GLEN) 441.30p -2.13%
Anglo American (AAL) 2,237.50p -2.12%
3i Group (III) 2,980.00p -2.10%

FTSE 250 - Risers

Bridgepoint Group (Reg S) (BPT) 274.20p 5.87%
AO World (AO.) 116.60p 1.57%
Close Brothers Group (CBG) 533.00p 1.43%
Me Group International (MEGP) 186.60p 1.19%
AJ Bell (AJB) 425.50p 1.19%
CMC Markets (CMCX) 313.50p 1.13%
Foresight Solar Fund Limited (FSFL) 92.00p 1.10%
Tyman (TYMN) 395.00p 0.89%
Herald Investment Trust (HRI) 2,260.00p 0.44%
Twentyfour Income Fund Limited Ord Red (TFIF) 105.00p 0.38%

FTSE 250 - Fallers

W.A.G Payment Solutions (WPS) 61.00p -3.79%
Wizz Air Holdings (WIZZ) 2,200.00p -3.08%
Ocado Group (OCDO) 380.60p -3.03%
Dr. Martens (DOCS) 72.10p -2.90%
PZ Cussons (PZC) 104.60p -2.61%
IP Group (IPO) 41.40p -2.59%
Hochschild Mining (HOC) 179.20p -2.50%
Babcock International Group (BAB) 499.80p -2.38%
Aston Martin Lagonda Global Holdings (AML) 149.30p -2.29%
Genus (GNS) 1,666.00p -2.23%