MARKET REPORT: BAE pulls out of Ukraine ceasefire talks

BAE Systems led the FTSE 100 lower as talk of a ceasefire in Ukraine sparked a sell-off in European defence stocks.

Shares in London-listed BAE fell 4.7 percent, or 62.5 pence, to 1,273 pence.

BAE’s share price has doubled in value since Vladimir Putin’s tanks rolled into Ukraine in February 2022. But a Bloomberg News report that some of Ukraine’s allies are starting to talk about a negotiated ceasefire put the brakes on the stock.

This was part of a broader sell-off in the European sector: Italy’s Leonardo fell 4.5 percent, while France’s Thales fell 3.8 percent.

Shares in Kingfisher rose after the owner of Screwfix and B&Q raised its profit forecasts amid signs of improving demand for UK housing.

The FTSE 100 company expects to report profits in the range of £510m to £550m for the year to the end of January.

That was above previous forecasts of between £490m and £550m. The stock gained 11.2 per cent, or 32.6 pence, to 322.9 pence.

The improved outlook came as customers continued to repair, maintain and renovate their homes, offsetting weaker demand for “big-ticket” items such as bathrooms and kitchens.

Kingfisher said trading remained stable in the UK and Ireland, while trading activity in France remained subdued.

Sales fell 1.8 percent to 6.76 billion pounds in the first half to the end of July, while profits fell less than 1 percent to 334 million pounds.

Chief Thierry Garnier said UK trading should improve next year amid “first signs” of a recovery in the housing market.

The broader stock market was also positive as traders anticipate an interest rate cut by the US Federal Reserve on Wednesday.

Speculation has been mounting that the Federal Reserve will implement a massive half-percentage point rate cut.

The FTSE 100 rose 0.4 per cent, or 31.42 points, to 8,309.86 and the FTSE 250 rose 0.1 per cent, or 15.01 points, to 20,944.6.

Burberry shares rose 3.1 percent, or 18.4 pence, to 605.2 pence as investors welcomed the positive reception to its latest collection at London Fashion Week.

And the troubled luxury brand’s new boss Joshua Schulman was reported to have said at the event that he will not take the brand downmarket. This comes after Burberry was recently demoted from the FTSE 100 following a fall in its valuation.

Susannah Streeter, director of money and markets at Hargreaves Lansdown, said yesterday: “Burberry appears to have regained some momentum, but a sustained recovery is likely to require considerable investment and patience.”

Component supplier Essentra has issued a profit warning as it said falling European share prices in August and September would hit business. The group expects to report profits of between £40m and £42m for the year.

That was below market forecasts for profits of between £48.4m and £49.7m. Shares fell 15.2 per cent, or 25.4 pence, to 141.8 pence.

GSK’s Blenrep drug combined with other treatments will be evaluated by regulators in Japan for patients with multiple myeloma, a blood cancer. The shares fell 1.4 percent, or 22.5 pence, to 1,609.5 pence.