FTSE down as trade news continues to rattle markets

Trade threats seem to be becoming part of the landscape this summer and they keep knocking down markets across the globe.

This morning Shanghai shares fell to their lowest level in two years after President Trump said he was ready to impose more tariffs on $200 billion worth of goods from China as soon as the public comment period on the plan ends next week.

In a lengthy interview with Bloomberg he also said that the Federal Reserve should support him more in his trade fight with China. His trade-related comments didn’t stop there.

Repeating previous arguments, Trump also threatened to pull out of the World Trade Organisation unless the organisation starts treating the US better.

The FTSE stumbled early on all this news, trading 0.2% lower as property website Rightmove shares traded down 89% but the shares have been subdivided into one tenth of the previous price. Even so, property portal could end up being relegated from the FTSE 100 shortly if its share price continues to slide.

Earlier this year the company’s shares rallied amid a flurry of takeovers in the property sector, but falling house prices, particularly in London and increasing competition from Zoopla and PurpleBricks, ended up eroding Rightmove’s profits.

Whitbread shares climb as it agrees Costa sale to Coca Cola

The market has also been buzzing with the news that Whitbread is selling its Costa coffee brand to Coca Cola for £3.9 billion.

The sale is expected to be completed in the first half of next year and comes instead of the planned demerger which Whitbread CEO Alison Brittain had originally been discussing. The deal represents a good return for Whitbread, which purchased the coffee chain for £19 million. Whitbread shares were up around 15% on the news.

UK house prices lower

Though numerous analysts expected UK house prices to show a slight increase in August the market turned the other way and prices across the country declined by 0.5%.

Borrowing costs remain fairly low even after the latest Bank of England rate hike, but UK household finances are becoming slightly more stretched and the uncertainty over Brexit is seeping into the UK housing market.

Mortgage lender Nationwide, which has been compiling house price data since 1952, says that the overall housing market is still relatively in balance and that on an annual basis growth over the next few months remains in a fairly narrow range between 2-3%.

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