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(Alliance News) - London stocks were on the slide yet again at the start of the week as traders fretted over the deteriorating relationship between the US and China following a weakening in the yuan. The pound, meanwhile, got a modest bump after the UK services sector surprised to the upside in July.The large-cap index was 142.11 points, or 1.9%, lower at 7,264.95 on Monday at midday. The FTSE 100 had already shed 2.3% on Friday in the wake of US President Donald Trump's latest China tariff threat. The index is down almost 6% in the past week.The mid-cap FTSE 250 index was down 293.55 points, or 1.5%, at 18,959.62 on Monday, while the AIM All-Share was down 1.3% at 909.11.The Cboe UK 100 index was down 1.9% at 12,313.59. The Cboe UK 250 was down 1.8% at 16,887.99, while the Cboe UK Small Companies was down 0.4% at 10,984.79.In Paris, the CAC 40 stock index slumped 1.9% while the DAX 30 in Frankfurt was off 1.5% in early afternoon trade."European equity markets have been rocked by the rising trade tensions between the US and China. The fact the Chinese central bank allowed the yuan to fall through the 7 mark against the US dollar without intervening is a clear indication that Beijing means business," said David Madden at CMC Markets. "The softness in the Chinese currency should assist domestic exporters, but it could be construed as a dig at the Trump administration, as President Trump is quick to call out currency manipulation," he added.Trump has frequently accused China of artificially devaluing its currency in order to support its exports - charges long denied by Beijing.The US president jolted global stock markets last week when he issued the threat of more tariffs just a day after US and Chinese trade negotiators revived talks aimed at ending the year-long dispute. The extra 10% duties Trump threatened to implement from September 1 would mean he has now targeted virtually all of the USD500 billion in goods America buys from China every year.China on Friday threatened to retaliate against any new US tariffs. It has already imposed its own duties on USD110 billion in American goods, almost all of the products it imports from the country. Given China's limited room to further hit US imports, the weakening of the yuan has been seen as a deliberate retaliation towards Trump."The Chinese authorities defended USD/CNY 7 in 2016, 2018 and earlier this year but the mood has changed," commented Kit Juckes at Societe Generale.A report by Bloomberg News said China has asked its state-owned enterprises to stop buying US farm goods, in a further sign of escalating tensions.Amid the trade war worries, Wall Street is on course for a lower open on Monday with the Dow Jones and S&P 500 both called down 1.1%, and the Nasdaq Composite seen off 1.5%. Still to come in the economic calendar on Monday, the US IHS Markit Services PMI is at 1445 BST, with the ISM Non-Manufacturing PMI at 1500 BST. In the UK, the pound reversed a morning decline after a better-than-expected performance from the services sector.IHS Markit/CIPS Services PMI Business Activity Index registered 51.4 in July, up from 50.2 in June and coming in above the no-change mark of 50 for the fourth month in a row. Consensus, as cited by FXStreet, was for a July services reading in line with the prior month. "The hard data has held up better than the surveys for much of the first half of the year. And that is likely to be the case again in Q3 as the drag on Q2 growth from stockbuilding and untimely car plant shutdowns in April is reversed," commented Capital Economics."As such, the stagnation in Q2 (which we expect to be revealed when the data is released on Friday) shouldn't be repeated in Q3."The pound was quoted at USD1.2131 at midday, up slightly from USD1.2122 late Friday.In London at midday, Fresnillo was among few risers in the FTSE 100 amid Monday's trade-war drive sell-off. Mexican gold miner Fresnillo was up 3.9% as the price of safe haven asset gold benefited from Monday's sour mood towards equities. An ounce of the precious metal was quoted at USD1,456.60 at midday, up from USD1,445.50 late Friday. Mid-cap gold miners also were rising, with Hochschild Mining up 1.5% and Acacia Mining up 0.8%. Towards the bottom of the large-cap index was retailer Marks & Spencer, 4.5% lower as it concluded the purchase of half of Ocado's retail business. In February, the two FTSE 100 companies formed a 50-50 joint venture, with M&S paying Ocado GBP750.0 million for its 50% stake in the retail business. Ocado Retail will begin selling M&S products on September 1, 2020, unless its current arrangements with John Lewis & Partners-owned Waitrose terminates sooner. Over 6,500 M&S grocery products will be available to Ocado shoppers, the company said. Ocado shares were down 2.7% at midday. HSBC Holdings was down 1.3% after the lender reported a rise in interim profit and the surprise departure of its chief executive. Chief Executive Officer John Flint will be stepping down from his role to be replaced by Global Commercial Banking CEO Noel Quinn on an interim basis. HSBC said Flint was stepping down "by mutual agreement" and is "not carrying out his day-to-day duties after today". Flint was head of HSBC's retail banking and wealth management operations prior to taking over from former HSBC CEO Stuart Gulliver in February 2018. "With the retail bank doing well when others are struggling, and the outlook for the investment bank set to improve, the change of leadership could be particularly confusing," said Nicholas Hyett at Hargreaves Lansdown. The analyst continued: "However we think the very cautious outlook statement might provide the explanation. With macroeconomic and geopolitical headwinds mounting, the HSBC board could be looking for more radical reform, what that will look like remains to be seen."Turning to the lender's first-half results, HSBC saw a 16% jump in pretax profit to USD12.41 billion from USD10.71 billion a year before. The lender did note, however, its investment bank Global Banking & Markets saw revenue slip in the half. Among the stocks dragging on the FTSE 250, BBA Aviation was down 4.1% despite reporting a sharp rise in interim profit. In the six months to June 30, BBA saw pretax profit rise 22% to USD156.0 million from USD128.2 million the year before. Underlying profit, on a pre-IFRS 16 basis, grew 5.3% to USD190.0 million, with the company attributing the growth to its fixed base operation business, Signature, which outperformed the US business & general aviation market. Revenue increased 20% to USD1.53 billion from USD1.28 billion the year before. "The first half of 2019 has been broadly in line with our expectations for BBA Aviation, with a solid Signature performance, in a flat business & general aviation market. Our Ontic legacy business has delivered a strong performance," said BBA CEO Mark Johnstone.Last week, BBA Aviation said it had agreed to sell its aerospace parts and services unit Ontic to CVC Fund Vll, managed by private equity firm CVC Capital Partners, for an enterprise value of USD1.37 billion. It expects to return between USD750 million and USD850 million of that to shareholders.