LONDON MARKET OPEN: Stocks Up As US Eases Restrictions On Huawei

LONDON (Alliance News) - Stock prices in London opened higher on Tuesday after the US government decided to temporarily ease some trade restrictions on Huawei.The FTSE 100 was up 23.36 points, or 0.3% at 7,334.24. The FTSE 250 was up 78.51 points, or 0.4% at 19,414.10. The AIM All-Share was up 0.2% at 959.11.The Cboe UK 100 index was up 0.5% at 12,455.35. The Cboe UK 250 was up 0.1% at 17,395.03, and the Cboe UK Small Companies was flat at 11,840.44.In European equities, the CAC 40 in Paris was up 0.3% and the DAX 30 in Frankfurt was up 0.1%. The US Commerce Department late Monday announced a grace period of 90 days on the new policy. Following the decision, the US will continue to allow the Chinese technology major to purchase US goods in order to maintain existing networks and provide software updates to existing Huawei handsets.However, Huawei will not be allowed to buy American parts and components to manufacture new products without license approvals.Further, Huawei and Google are discussing solutions to restrictions placed by the US government on companies that do business with the Chinese telecom giant, Huawei founder Ren Zhengfei told domestic media on Tuesday."Google is a good company, a highly responsible company," Ren said in an interview published by various Chinese media outlets.CMC Markets analyst Michael Hewson said: "European markets have got off to a positive start this morning after yesterday's sharp sell off with banks leading the gainers after the US issued a 90 day waiver to Huawei to continue supplying software updates and hardware maintenance to US and other companies to ensure the integrity of the current infrastructure and security of its users. "While it's a small measure it does perhaps symbolise that there might be a reverse gear from the current slide to what could well turn into a full blown trade war between the US and China, that could drag the whole global economy down in its wake."In the FTSE 100, luxury firm Burberry was up 1.1% after Bernstein upgraded the fashion house to Market Perform from Underperform. Severn Trent was up 0.3%. The water company hiked its annual dividend after profit and revenue grew amid an improving operational performance.For the financial year that ended in March, pretax profit widened 6.8% to GBP563.3 million from GBP527.2 million the year prior. This was after revenue rose 6.0% to GBP1.77 billion from GBP1.67 billion. Severn Trent proposed a 56.02 pence per share final dividend, up 7.9% from 51.92p the year prior. For the full year, the dividend also rose 7.9%, to 93.37p from 86.55p the year before. In the utility sector, power firm SSE will report annual results on Wednesday, while Severn Trent's water peer United Utilities will report full-year earnings on Thursday. SSE was down 0.9%, and United Utilities was up 0.5%.In the FTSE 250, Galliford Try was up 10% after the construction company said it anticipates annual earnings consistent with expectations and said the restructure of Construction arm is underway. Galliford Try said it will "resize" the Construction business to improve performance and cut 350 jobs. Electrocomponents was up 3.5% . The engineering firm boosted its dividend after annual profit improved, though revenue growth has slowed since the start of the new year.For the financial year that ended in March, pretax profit widened 16% to GBP195.2 million from the GBP168.6 million the year prior. This was after revenue rose 9.9% to GBP1.88 billion from GBP1.71 billion the year before, up 8.5% on a like-for-like basis. Electrocomponents proposed a 9.5 pence per share final dividend, up 19% from 8.0p the year prior. For the full year, the dividend rose 12% to 14.80p from 13.25p the year before. At the other end of the mid-caps, Entertainment One was the worst performer, down 4.0% after the television and film content producer reported a drop in annual revenue.For the financial year ended March 31, revenue fell 9% to GBP941.2 million from GBP1.03 billion last year and pretax profit was down 43% to GBP36.8 million from GBP64.9 million prior. Looking forward, Entertainment One said underlying earnings before interest, tax, depreciation and amortisation margin will be "slightly reduced" due to investment in additional infrastructure.The Japanese Nikkei 225 index closed down 0.1%. In China, the Shanghai Composite closed up 1.2%, while the Hang Seng index in Hong Kong is down 0.1%.The pound quoted at USD1.2701 early Tuesday, lower than USD1.2731 at the London equities close Monday."The British pound remains under pressure, as markets focus on Brexit and political headlines in the absence of key data releases today," analysts at Lloyds noted. UK Chancellor of the Exchequer Philip Hammond will make an explosive intervention in the looming Tory leadership race with a fierce attack on advocates of a no-deal Brexit.In remarks set to raise Tory tensions on EU withdrawal, the chancellor will claim supporters of leaving the bloc without an exit agreement are trying to "hijack" the result of the referendum.Hammond will use a speech to the CBI's annual dinner in London on Tuesday to warn against "right-wing populism".He will say that if the Brexit issue is not resolved in the next few weeks there is a "real risk" of a new prime minister moving towards a "damaging" no-deal exit policy for "ideological" reasons.The economic events calendar has eurozone consumer confidence at 1500 BST.