Image Source: Pexels

British stocks initially rose on Friday, buoyed by positive signals of easing tensions in the U.S.-China trade dispute and better-than-expected British retail sales data. However, as the markets approached closing, investors began reducing risk ahead of the weekend, causing the FTSE to turn negative, snapping its winning streak. China has exempted certain U.S. imports from its 125% tariffs and is encouraging companies to identify essential products they need without levies, reflecting Beijing's concerns about the economic impact of the trade conflict. Meanwhile, Washington appears to be signalling a desire to ease tensions, offering some relief to markets as investors anticipate a reduction in trade disputes between the two largest economies. In another development, British retail sales unexpectedly rose by 0.4% in March, marking the strongest quarter since 2021. Nonetheless, this positive economic indicator seems short-lived, as consumer confidence fell in April to its lowest level since late 2023, driven by rising energy prices. Furthermore, major British retailers have issued grim outlook statements for this month.

Single Stock Stories & Broker Updates:

• Mobico shares plummet 19% to 47.78p, marking their lowest since June 2024. The stock is the top loser on the FTSE mid-cap index, which is up 0.3%. The company plans to sell its school bus unit in North America to I Squared Capital for up to $608 million, below Jefferies' estimated value of $1,275 million. Mobico expects 2024 adjusted operating earnings at the lower end of its forecast range of £185-£205 million ($246.20-$272.81 million). Including today's drop, the stock is down about 40% year-to-date.

• The aerospace and defence sector rose to the forefront, increasing by 2%. Engineering company Babcock International Group saw a 2.4% rise and ranked among the top gainers in the FTSE 100 after predicting annual operating profits that exceed market expectations.

• Bristol Myers Squibb reported higher-than-expected Q1 revenue and raised its full-year forecast, driven by its cancer-fighting drug portfolio. Median PT of 28 brokerages is $56. Bernstein ("market perform," PT: $62) expresses concern over Bristol's reliance on legacy products and FX amid policy volatility, despite liking the beat and raise. The brokerage is optimistic about early launch signs for Cobenfy (schizophrenia treatment) and Opdivo Qvantig (cancer immunotherapy). Citigroup ("neutral", PT: $51) anticipates sustained commercial execution and strategic business development to counter patent expirations, citing strong legacy portfolio results and growth momentum. Truist Securities ("buy", PT: $65) believes BMY's cost-cutting, global manufacturing presence, and business development focus position it well for growth. Leerink Partners ("outperform", PT: $55) sees no imminent catalysts but highlights pipeline optionality in the coming years.

Technical & Trade View

FTSE Bias: Bullish Above Bearish below 7600

• Primary support 7500
• Below 7400 opens 6850
• Primary objective 8500
• Daily VWAP Bullish
• Weekly VWAP Bearish

(Click on image to enlarge)

More By This Author: