London close: Top flight index starts the fourth quarter on a down note

(Sharecast News) - London's blue chip stocks finished slightly lower on the first day of October as positive manufacturing data and encouraging news on North American trade were offset by a Ryanair profit warning and housing sector angst.The FTSE 100 was down 14.53 points or 0.19% at 7,495.67 . The pound was little moved against the US dollar, edging higher by 0.05% to trade at 1.30361, but gained 0.32% versus the euro to 1.1263.London stocks underperformed their European and major Asian peers, as global equities rallied on an improved picture for global trade after Canada and the US were reported to have reached an agreement on how to revamp Nafta.Dampening some of the optimism around global trade was the release overnight of two surveys of manufacturing sector conditions in China for the month of September which revealed unexpected declines.Nevertheless, the news out of North America saw the S&P 500 surge at the start of the quarter, whilst Japan's yen tumbled to a fresh 2018 low versus the Greenback on diminished safe haven demand."There are plenty of reasons to keep wariness in reserve in case the deal unravels," said market analyst Ken Odeluga at City Index. "But so long as it holds, the development is undoubtedly the most effective shot in the arm laggardly global equity markets have received for months."Italy was still closely watched around Europe, analysts at Rabobank noted, on a report by Italian daily La Repubblica that there were "rumours" in Brussels that the European Commission will be forced to reject the Italian government's budget proposals in November.Both the Italian Prime Minister Giuseppe Conte and one of his deputies, the Five Star Movement's Luigi di Maio, said on Monday they would cut Italy's debt pile as they pursue the country's largest investment programme. "We have laid down the foundation for a serious, courageous budget, which looks towards growth within a framework of stability in the public accounts," said Conte.Earlier, some analysts had warned that if the Italian government failed to convince markets of its commitment to lowering the country's debt then higher interest rate costs might thwart its plans.Closer to home, UK manufacturing activity unexpectedly improved last month, with IHS Markit's purchasing managers' index rising to 53.8 for September from an upwardly revised 53.0, better than the 52.8 that economists had predicted.Economist Andrew Wishart at Capital Economics said the slight rebound in the PMI suggests that the sector provided small boost to quarterly GDP growth in the third quarter."Note too that the forward-looking orders and export orders balances also picked up, suggesting that the improvement could be sustained and that Brexit concerns are not weighing on external demand for UK goods," he said.On the other side of the globe, China's official manufacturing purchasing managers index fell much more than expected in September to from 51.3 to 50.8, falling short of economists' forecasts for a reading of 51.2. Earlier the Caixin's factory sector PMI slipped from 50.6 for the month of August to 50.0 in September, versus the 50.5 expected."The sector just managing to remain in expansion is the clearest sign yet of the impact of the US trade tensions on the Chinese economy," said analyst Jasper Lawler at London Capital Group. However, while miners traced metal prices lower in Australia, the trend was not followed by the heavily weighted miners on the FTSE, which were either flat or higher.In a fairly quiet start to the week for corporate news in London, airlines easyJet and BA owner IAG were flying lower after a profit warning from Irish budget airline Ryanair. The Dublin-based carrier blamed cabin crew and pilot strikes, lower traffic and weaker fares as it cut full year profit guidance 12% to €1.1-1.2bn from €1.25-1.35bn previously, also warning that it cannot rule out further downgrades due to the potential for more disruptions later in the year.Housebuilders were in the red after Theresa May looked to add a new stamp duty on foreign buyers to her Chancellor's upcoming Budget, which analysts at UBS said was "an unhelpful development for the London housing market". South East-focused Berkeley Group led the sector lower, with Taylor Wimpey, Barratt and Persimmon not far behind.Outdoing them with an 18% plunge was Royal Mail after releasing a late-afternoon profit warning on the back of lower letter volumes, a dip in parcel profits and slower progress with cost cutting since resolving industrial action in March. As a result group adjusted operating profit before transformation costs were guided to be in the range of £500-550m for the year.Just Group was down 9.16% as it revealed that chief financial officer Simon Thomas was stepping down after 12 years in the job.AstraZeneca was slightly lower even though it agreed a deal with Germany's Cheplapharm Arzneimittel for the commercial rights to its Atacand heart and hypertension treatments, starting with an up-front $200m fee and with further sums payable in future.GKN owner Melrose was in the red amid a report from the Telegraph that the industrials group is preparing to sell US air conditioning manufacturer Nortek as part of a string of sales expected to raise up to £6bn.Healthcare property developer Assura was down slightly as it reported completion of 39 medical centres and two developments at a total cost of £108.2m in the first half of its trading year.Computacenter was moving higher as it bought US-based IT firm FusionStorm for up to $90m (£69m) plus $45m in refinancing. The FTSE 250 company said it would integrate its existing US business with FusionStorm leading to a 50% rise in headcount in the Americas region.Copper mining giant Antofagasta was up as it was upgraded to 'buy' by Bank of America Merrill Lynch, while Serco benefited from a Citi upgrade to 'neutral' from 'sell'.Berenberg analysts upped their recommendations on both Barclays and RSA Insurance to 'buy' from 'hold', while Thomas Cook was bumped up to 'hold' from 'sell' but with a lower target price.United Utilities was boosted as Deutsche Bank issued a 'buy' rating for the stock and raised the price target to 850p, from 820p after the company's positive trading statement at the end of last week.Market MoversFTSE 100 (UKX) 7,495.67 -0.19%FTSE 250 (MCX) 20,401.21 0.46%techMARK (TASX) 3,504.47 0.04%FTSE 100 - RisersHalma (HLMA) 1,504.00p 4.08%Rentokil Initial (RTO) 330.70p 3.55%DCC (DCC) 7,165.00p 2.87%RSA Insurance Group (RSA) 591.00p 2.78%GVC Holdings (GVC) 939.50p 2.29%Burberry Group (BRBY) 2,053.00p 1.74%WPP (WPP) 1,144.00p 1.73%NMC Health (NMC) 3,452.00p 1.71%Scottish Mortgage Inv Trust (SMT) 549.60p 1.53%Smiths Group (SMIN) 1,516.50p 1.37%FTSE 100 - FallersRoyal Mail (RMG) 393.80p -17.96%easyJet (EZJ) 1,225.50p -7.00%Berkeley Group Holdings (The) (BKG) 3,561.00p -3.37%Standard Chartered (STAN) 615.50p -3.28%International Consolidated Airlines Group SA (CDI) (IAG) 643.20p -2.57%Schroders (SDR) 3,022.00p -2.36%British American Tobacco (BATS) 3,503.00p -2.27%Persimmon (PSN) 2,319.00p -1.99%Taylor Wimpey (TW.) 168.65p -1.98%Shire Plc (SHP) 4,543.50p -1.73%FTSE 250 - RisersIndivior (INDV) 193.25p 4.94%Vivo Energy (VVO) 135.00p 4.59%Serco Group (SRP) 101.90p 4.19%Rank Group (RNK) 175.80p 3.41%Hastings Group Holdings (HSTG) 267.80p 3.24%On The Beach Group (OTB) 511.00p 3.23%IMI (IMI) 1,134.00p 3.19%TP ICAP (TCAP) 275.70p 3.18%Spire Healthcare Group (SPI) 146.90p 3.09%Hunting (HTG) 804.00p 2.94%FTSE 250 - FallersJust Group (JUST) 80.30p -9.16%Wizz Air Holdings (WIZZ) 2,650.00p -7.89%Metro Bank (MTRO) 2,852.00p -4.10%Superdry (SDRY) 1,046.00p -3.68%Babcock International Group (BAB) 700.20p -3.15%Hochschild Mining (HOC) 158.75p -3.05%Equiniti Group (EQN) 258.00p -3.01%TalkTalk Telecom Group (TALK) 119.60p -3.00%Capita (CPI) 138.90p -2.80%Provident Financial (PFG) 587.20p -2.78%