* FTSE 100 down, FTSE 250 down 0.4%
* Financials, oil majors drag on main index
* BAT has worst day in 7 months
* Pendragon tanks to 6 yr low after profit warning
* Majestic Wine gains after report Elliott to bid for outlets (Adds news item, graphic, updates to closing prices)
By Shashwat Awasthi
June 12 (Reuters) - London's main index eased as the latest salvoes in the U.S.-Chinese trade dispute kept investors on edge and weak demand outlook knocked oil shares, while British American Tobacco slid after warning of steeper declines in cigarette sales.
Oil majors were the biggest drags on the main index as oil prices slid more than 2%. O/R
Financial stocks also weighed as President Donald Trump added to the trade nerves by saying he was not interested in a deal with Beijing unless it agreed to some "major points" in negotiations, while China declared it was "not afraid of fighting a trade war". American Tobacco BATS.L skidded 4.4% on its worst day in seven months after it warned of steeper declines in cigarette sales globally mainly due to waning demand in its main U.S. market. the blue-chip index's losses last month were driven by fears that Trump's spats with trade partners were set to weaken global growth, the rises since have seen markets convinced that the U.S. Federal Reserve and other central banks will respond quickly with stimulus if needed.
"The rally has paused and things may get a bit tricky now as we may well see the market start to think - one may even say realise - that the Fed is not necessarily going to ride to the rescue," Markets.com analyst Neil Wilson said.
However, a timid U.S. inflation report seemed to bolster hopes of interest rate cuts. Benckiser RB.L erased earlier losses to end 4.4% higher. The consumer goods firm named PepsiCo PEP.O executive Laxman Narasimhan to succeed outgoing chief executive officer Rakesh Kapoor.
Small-cap car dealership chain Pendragon PDG.L lost more than a fifth of its value and slumped to a more than 6-1/2 year low as significant declines in new car and used car registrations caused it to warn on full-year profit. Shares of larger peer Auto Trader AUTOA.L shed 2.4% on the FTSE 100.
Shares of sub-prime lender Provident Financial PFG.L tumbled 6.6% on the mid-caps after Canaccord Genuity cut its rating to "sell", citing precarious capital position and dividend risks. Majestic Wine WINEW.L surged nearly 10% after a Sky News report that activist fund Elliott Advisors had launched a bid for 200 of the specialist wine retailer's outlets.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Tobacco stocks underwhelm amid shift to alternative smoking products
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.