LONDON (Alliance News) - Stock prices in London closed broadly higher on Wednesday amid a modest softening of US-China trade tension, whilst AIM suffered at the hands of a share plummet at index heavyweight Burford Capital. The FTSE 100 index closed 0.4% higher at 7,198.70. The mid-cap FTSE 250 index ended up 0.5% at 18,941.00, and the AIM All-Share index finished 2.2% lower at 876.37.The Cboe UK 100 closed up 0.3% at 12,195.54, the Cboe UK 250 up 0.3% at 16,879.31, but the Cboe UK Small Companies down 0.2% at 10,934.84.At the close Wednesday, sterling was modestly firmer against the US dollar. The pound was quoted at USD1.2158 at the London close, from USD1.2156 late Tuesday.CMC Markets UK Market Analyst David Madden said main markets in Europe "are largely positive this afternoon but the trade tensions are still bubbling away in the background.""Central banks in New Zealand, Thailand, and India all cut rates overnight and that highlights how concerned central bankers are about the state of the global economy," Madden added. "The equity benchmarks in Europe that are higher, are showing small gains, and it doesn't exactly project an air of confidence, and there is a sense the recent bounce is on shaky grounds."Global markets have been rattled since US President Donald Trump ramped-up trade tension between the US and China last Thursday by announcing plans to slap 10% tariffs on a further USD300 billion of goods imported from China from the start of September.These fresh tariffs were on top of the 25% duties on USD250 billion of Chinese imports to the US already in place.The news sent markets reeling with the Chinese yuan weakening sharply to above USD7.00 on Monday, leading to Trump and other US officials accusing China of currency manipulation shortly after.Since then, however, there have been tentative signs of the two economic superpowers rowing back modestly on some of the more troubling rhetoric. Early Wednesday, the People's Bank of China set the official reference point for the yuan to USD 6.9996. This was "just marginally stronger than 7 that by many is seen as a key level", Danske Bank Fixed Income Research Head Arne Lohmann Rasmussen said. "White House economic advisor Larry Kudlow also reassured that the US remains committed to trade negotiations with China next month as planned," Rasmussen added. "Kudlow also said that the US 'would take a careful look at whether China took measures to reverse the decline of the yuan ... [and] that things could change in respect of tariffs.' It seems that the US is backtracking a little after the 'currency manipulator' label earlier this week."Amongst the blue chip gainers, Paddy Power and Betfair parent Flutter Entertainment was helping to push up the FTSE 100, rising 6.0%, as it reported forecast-beating interim results."Admittedly that says as much about how low expectations had fallen, thanks to the pressure brought to bear on the betting industry by stricter legislation, a crackdown on advertising, higher taxes and increased customer acquisition costs thanks to political pressure for improved protection of vulnerable customers," AJ Bell Investment Director Russ Mould said. For the six months ended June, pretax profit narrowed 24% GBP81 million despite revenue rising 18% to GBP1.02 billion. Underlying earnings before interest, taxes, depreciation & amortisation fell 10% to GBP196 million, beating the consensus forecast of GBP172 million. Gold miner Fresnillo surged 5.6% after the price of the precious metal continued to test new multi-year highs amid ongoing trade tension angst. "In a sign of investors' anxieties, gold breached USD1,500 per ounce for the first time in six years as it climbed 2% on Wednesday afternoon," SpreadEx Financial Analyst Connor Campbell said.Gold was quoted at USD1,505.49 an ounce at the London equities close, higher versus USD1,472.50 Tuesday.As well as sending investors towards safe haven gold, concerns about trade tensions and their impact on global growth also push oil prices sharply lower.Brent oil was quoted at USD56.30 a barrel at the London equities close, lower than USD59.78 Tuesday.Amongst the FTSE 100 in London, Standard Life Aberdeen closed down 7.5% as a modest reduction in fund outflows failed to impress investors. At the end of June, the fund manager recorded assets under management & administration had risen 4.7% to GBP577.5 billion on six months earlier. Net fund outflows during the six months amounted to GBP15.9 billion. This was better than the GBP16.9 billion recorded during the same period the year prior and the GBP24.0 billion outflow seen in the second half of 2018.Hargreaves Lansdown analyst George Salmon said: "While less negative than last year, outflows remain Standard Life Aberdeen's Achilles heel with billions of pounds of investors' money walking out the door every quarter.""That's particularly problematic because a strategic repositioning that culminated in the sale of the Phoenix business means the group is increasingly focused on asset management rather than insurance", Salmon added.Valves and pumps maker Spirax-Sarco Engineering closed 6.4% lower after the blue chip firm warned that growth forecasts for the remainder of the year were weaker than expected, despite delivering strong interim results. For the six months ended June, pretax profit widened 1.2% on the year prior to GBP108.1 million after revenue rose 8.0% to GBP591.2 million. Despite the "strong" first half results being ahead of expectations, Spirax-Sarco Chief Executive Officer Nicholas Anderson cautioned that "industrial production growth forecasts for the second half of the year have weakened below earlier estimates."In the mid-caps, however, industrial firms were doing well amid a flurry of upbeat results.Ultra Electronics closed at the top of FTSE 250, up 11%, after lifting its interim dividend and reporting a sharp rise in profit.For the six months ended June, pretax profit almost doubled to GBP37.9 million from GBP20.0 million the year prior after revenue rose 10% to GBP387.1 million. Meanwhile, the order book grew 4.2% on the year prior to GBP1.01 billion. Ultra proposed a 15.0 pence per share interim dividend, up 2.7% from 14.6p the year before. Infrastructure products maker Hill & Smith ended just behind, 7.8% higher, on a "much improved" interim performance, also shunting its payout higher. For the six months ended June, pretax profit widened 16% to GBP33.4 million on the year prior after revenue rose 15% to GBP339.5 million."Hill & Smith delivered a much-improved performance in the period over a weaker first half last year," Chief Executive Derek Muir said, adding that the company is confidence in achieving further growth.Hill & Smith proposed a 10.6 pence per share interim dividend, up 6.0% from 10.0p the year prior.On the AIM market, the index was dragged lower after litigation finance firm Burford Capital plummeted 54% after it was forced to defend itself from an attack by Muddy Waters Capital in which the US research firm took a short position on Burford on the basis that it was "a poor business masquerading as a great one" by using "heavily manipulated" figures.At the close on Tuesday, Burford had a market capitalisation of over GBP3.00 billion which - had it been on the main market - could have entitled it to a space on the FTSE 250 index. Burford replied to the report by Muddy Waters by stating its cash position and access to liquidity was strong, and that its returns were robust.Meanwhile, medical imaging technology firm Feedback closed 30% lower after it confirmed it was working on a potential share placing to fund development of its Bleepa clinical messaging product.Feedback issued the announcement following unspecified "online commentary" that it was seeking an equity fundraising. On Wall Street, the Dow Jones was trading 1.2% lower, the S&P 500 down 0.5%, and the Nasdaq Composite was down 0.5%. In mainland Europe, in Paris the CAC 40 equities index ended up 0.9% and the DAX 30 in Frankfurt ended up 1.0%.The euro was quoted at USD1.1230, compared to USD1.1195 late Tuesday.In a quiet economic calendar on Thursday, Japanese foreign investment figures are published at 0050 BST with Chinese trade balance data later in the day. In the US, jobless claims data are release at 1330 BST. Included in the UK corporate events on Thursday, interim results are due from insurer Aviva, soft drink bottler Coca-Cola HBC and fund manager Hargreaves Lansdown. Half year results are also expected by online property Rightmove, estate agent Savills and property owner Derwent London. By Ahren Lester; ahrenlester@alliancenews.com
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