London open: Stocks fall as Nvidia warns of $5.5bn hit from US-China trade war
London stocks fell in early trade on Wednesday despite better-than-expected UK inflation data, with sentiment dented after US chipmaker Nvidia warned it will take a $5.5bn hit from Donald Trump's trade war with China.
At 0900 BST, the FTSE 100 was down 0.5% at 8,211.69.
Steve Clayton, head of equity funds at Hargreaves Lansdown: "Asian markets were pressured overnight after the US placed additional curbs on Nvidia Corp's ability to ship advanced silicon chips into China. Shipments of Nvidia's H20 chips, previously allowed into China are now to be restricted, creating uncertainty about just where the US/China trading relationship was headed.
"Technology companies in Asia led the declines, with Chinese tech companies listed in Hong Kong tumbling by over 4%. Nvidia itself dropped 6% in US after-hours trading. Japan's Topix Index dropped over 1% before paring losses, whilst the Hang Seng index in HK fell by 2.2%. Shares in Korea and Taiwan also declined.
"The US also announced a probe into the trading of critical minerals and rare earths to see if levies needed to be introduced. In the current environment, few would bet that the probe will conclude that no, they do not."
On home shores, data from the Office for National Statistics showed that consumer price inflation rose 2.6% in the year to March, down from 2.8% in February and coming in below expectations of 2.7% growth.
The largest downward contributions came from recreation and culture, and motor fuels, the ONS said. The largest upward contribution came from clothing.
Core inflation - which excludes energy, food, alcohol and tobacco - rose by 3.4% in the year to March, down from 3.5% the month before.
ONS chief economist Grant Fitzner said: "Inflation eased again in March, driven by a variety of factors including falling fuel prices and unchanged food costs compared with the price rises we saw this time last year.
"The only significant offset came from the price of clothes, which rose strongly this month, following the unusual decrease in February."
In equity markets, Bunzl tumbled as it lowered its guidance for 2025 after a worse-than-expected start to the year, with profits down "significantly" in the first quarter due to a challenging economic backdrop.
The international distribution and services group said it now expects only a "moderate" increase in revenues at constant exchange rates this year, down from an earlier projection for "robust growth", while the operating margin is now expected to reduce to 8.0% compared with the initial targets for no change from 8.3% in 2024.
Barratt Redrow gained as it reported a stable trading performance for the quarter ended 30 March, with a slight year-on-year increase in its core private reservation rate and a total of 3,717 home completions, keeping it on track to deliver full-year guidance of 16,800 to 17,200 homes.
Oxford Instruments jumped after saying it delivered a "strong" full-year performance, in line with expectations.
Outsourcer Mitie rallied as it lifted its full-year profits guidance following "continued good momentum" in the fourth quarter, and announced the launch of a £125m share buyback.
Market Movers
FTSE 100 (UKX) 8,211.69 -0.45%
FTSE 250 (MCX) 19,169.76 -0.51%
techMARK (TASX) 4,416.08 -0.31%
FTSE 100 - Risers
Centrica (CNA) 150.20p 1.66%
Fresnillo (FRES) 1,075.00p 1.61%
Severn Trent (SVT) 2,737.00p 1.41%
Barratt Redrow (BTRW) 433.60p 1.38%
Persimmon (PSN) 1,192.00p 1.36%
Diageo (DGE) 2,063.00p 1.33%
Unilever (ULVR) 4,741.00p 1.15%
Coca-Cola HBC AG (CDI) (CCH) 3,710.00p 1.09%
National Grid (NG.) 1,065.50p 1.04%
SSE (SSE) 1,621.00p 0.97%
FTSE 100 - Fallers
Bunzl (BNZL) 2,276.00p -26.06%
Intermediate Capital Group (ICG) 1,757.00p -3.25%
Diploma (DPLM) 3,844.00p -2.93%
Smurfit Westrock (DI) (SWR) 3,057.00p -2.89%
Rentokil Initial (RTO) 325.40p -2.63%
JD Sports Fashion (JD.) 73.12p -2.58%
Scottish Mortgage Inv Trust (SMT) 861.40p -2.56%
Informa (INF) 698.00p -2.38%
Ashtead Group (AHT) 3,852.00p -2.31%
Flutter Entertainment (DI) (FLTR) 17,095.00p -2.15%
FTSE 250 - Risers
Oxford Instruments (OXIG) 1,728.00p 6.14%
Mitie Group (MTO) 127.80p 4.75%
Endeavour Mining (EDV) 2,138.00p 4.19%
Hochschild Mining (HOC) 313.80p 3.36%
Discoverie Group (DSCV) 557.00p 2.96%
Empiric Student Property (ESP) 87.90p 1.15%
Drax Group (DRX) 569.50p 0.98%
Big Yellow Group (BYG) 951.00p 0.96%
Helios Towers (HTWS) 108.60p 0.93%
Derwent London (DLN) 1,904.00p 0.90%
FTSE 250 - Fallers
XPS Pensions Group (XPS) 380.00p -3.18%
Oxford Nanopore Technologies (ONT) 121.00p -3.12%
Diversified Energy Company (DEC) 840.50p -3.06%
Harbour Energy (HBR) 151.40p -2.95%
JPMorgan Global Growth & Income (JGGI) 499.50p -2.44%
Raspberry PI Holdings (RPI) 433.50p -2.32%
Ninety One (N91) 131.20p -2.31%
Energean (ENOG) 800.00p -2.26%
Fidelity Emerging Markets Limited Ptg NPV (FEML) 651.00p -2.25%
Bridgepoint Group (Reg S) (BPT) 260.80p -2.25%
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