UPDATE 2-UK stocks up on China tariff cut, but Royal Mail at life low

  • Reuters
  • Stock Market News
UPDATE 2-UK stocks up on China tariff cut, but Royal Mail at life low
Credit: © Reuters.

* FTSE 100, FTSE 250 up 0.3%

* China to reduce tariffs on some U.S. imports

* Royal Mail skids after trading update

* Beazley marks best day in over a decade (Adds company news items, updates share moves to closing prices)

By Shashwat Awasthi and Muvija M

Feb 6 (Reuters) - UK shares advanced for a fourth straight session on Thursday as risk sentiment picked up after China pledged to halve tariffs on some U.S. imports, though Royal Mail slid to an all-time low after warning of a challenging year ahead.

China will cut additional tariffs levied against 1,717 U.S. goods last year, after a Phase 1 trade deal was signed last month, and as fears persist over the coronavirus outbreak, which has killed more than 550 people. FTSE 100 .FTSE rose 0.3%, but oil majors Shell RDSa.L and BP BP.L weighed on the index as they tracked crude prices lower. O/R

The FTSE 250 also added 0.3%, with insurer Beazley leading gainers with an 8% jump - its best one-day gain since 2009 - after its annual profit surged. Mail RMG.L , on the other hand, dropped 5% to an all-time low after the letter carrier warned outlook for the 2020-21 fiscal year was "challenging" and said the threat of a labour strike in late 2019 hurt parcel revenue growth during the Christmas period. company's strained relationship with the CWU union, which has called for a strike ballot, "bodes ill for both business as usual productivity improvements and reaping the benefits of the medium-term strategy," Liberum analyst Gerald Khoo wrote.


Global markets have been attempting a recovery after sharp losses last week, and were given a shot in the arm on Wednesday by media reports that scientists had developed a drug against the China-linked virus.

Though the World Health Organisation played down the reports, hopes that the outbreak would soon be contained as well as upbeat economic data from the United States helped boost stock bourses.

"The momentum is clearly with the bulls at the moment, and we see no reason to stand against that tide," OANDA analyst Jeffrey Halley said.

"The potential for an aggressive and rapid correction lower still lurks though, if negative Wuhan virus headlines emerge," he warned, adding that economic data for January was yet to show any severe spillover in growth from the virus.

GlaxoSmithKline GSK.L slipped 2.6%, following a more than 4% drop in the previous session when its fourth-quarter earnings missed analysts' estimates. Health NMC.L , whose shares have been battered after criticism from short-seller Muddy Waters late last year, took a U-turn to end 7.2% lower after soaring as much as 13% in early deals.

However, catering group Compass Group CPG.L added 3% and was among top blue-chip risers after upbeat quarterly report.

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