UKX FTSE 100 Index

By Dave Morris

London markets advanced despite the U.K.'s weakest construction activity figure since April 2009.

How did markets perform?

The U.K.'s FTSE 100 increased 0.5% to 7,535.1, adding to Monday's move up 1%.

The pound retreated 0.3% to $1.2610, after falling 0.6% Monday.

What's moving the market?

The Office of the U.S. Trade Representative added another 89 items to the list (https://www.wsj.com/articles/u-s-proposes-more-european-tariffs-pending-airbus-case-11562026415) of products from the European Union that could become subject to tariffs. The World Trade Organization is currently hearing a case against Airbus SE (AIR.FR) over whether it violated anti-protectionist rules around receiving government support. The new items bring the potential annual cost of the U.S. tariffs to approximately $21 billion a year.

The G-20's jolt of optimism around U.S.-China trade was tempered Tuesday as investors weighed the likelihood of an actual breakthrough. An official commentary by Chinese state media outlet Xinhua (http://www.xinhuanet.com/english/2019-07/01/c_138189987.htm) included a statement noting that the agreement to resume talks does not necessarily mean a deal to end the trade tension is imminent.

In economic data, the U.K. saw a sizable miss in the IHS Markit construction purchasing managers index (PMI) survey for June, coming in at 43.1 versus 49.3 predicted in a Thomson Reuters poll of economists. Brexit uncertainty was widely cited as a key factor in the weak figure, which is the lowest since April 2009.

Which stocks are active?

Jupiter Fund Management PLC (JUP.LN) shares dropped 7% following the asset management firm's announcement that one of its top fund managers, Alexander Darwall, had set in motion plans to launch his own firm (https://www.fnlondon.com/articles/jupiters-european-star-manager-will-quit-to-launch-own-business-20190701) pending approval from British regulators.

Funding Circle Holdings PLC (FCH.LN) shares plummeted 18% when the online small-business loans platform issued guidance that it was downgrading its expectations for full year revenue growth (https://www.fnlondon.com/articles/funding-circle-stock-tanks-as-company-cuts-revenue-target-20190702). The young company, whose shares are down nearly 66% since their initial public offering in 2018, said it had applied more stringent guidelines on lending to higher-risk clients due to rising economic uncertainty.

(END) Dow Jones Newswires

July 02, 2019 06:00 ET (10:00 GMT)

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