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FTSE opens a touch higher as good earnings outweigh North Korea concerns

Article By: ,  Senior Market Analyst
May 16, 2018 5:04 AM

The FTSE 100 barely scraped a higher opening to start the day up 0.1% at 7,727.91as positive earnings from Burberry and acquisition talks from Paddy Power balanced out the negative effect of Asian markets.

Key Asian indices were hit after North Korea made an angry statement threatening to withdraw from a historic summit with President Donald Trump if the US insisted that the country gave up its nuclear weapons. 

The summit is due to take place on 12 June and uncertainty over its occurrence cast a cloud over the Asian markets. The Nikkei closed 0.44% lower at 22,717.23 while Shanghai fell 0.71% to 3,169.57.

US markets also traded lower overnight after bond yields rose and Home Depot reported weak sales in the first quarter. The Dow Jones Industrial Average dropped 0.8% and the S&P 500 declined 0.7%.

Shares in bookmaker Paddy Power Betfair rose 1.22% to 7,832.50 as the company confirmed that it has started discussions to potentially merge its US operations with US-based fantasy sports site FanDuel. 

The new combined operations would target the US sports betting market. The timing will benefit from a US Supreme Court decision this week abolishing a federal law banning legalised sports gambling in New Jersey.

British luxury goods brand Burberry saw shares rise 2.08% after its earnings came in above analysts’ forecasts. The company, now headed by former Givenchy rising star Riccardo Tisci, said full year adjusted profit rose 2% to £467 million. 

Group revenue slipped 1% to £2.73 billion in what the company called a year of transition. Burberry maintained its guidance for both 2019 and 2020 and started a £150 million share buyback.

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