| London investors shrugged off renewed concerns about global trade wars on Friday thanks to receding political risk in Europe, but better UK manufacturing data lifted the pound to limit gains. The FTSE 100 ended the session up 23.57 points or 0.31% at 7,701.77, as the pound grabbed back some territory on the dollar, rising 0.44% to 1.3357 and up 0.6% against the euro to 1.1438. UK manufacturing data beat consensus forecasts, with a rise in the IHS Markit purchasing managers' index to 54.4 in May from the 53.9 17-month low a month before, ahead of the 53.5 expected. David Cheetham, chief market analyst at currency broker XTB, said while the figure itself remains relatively weak in being the third lowest in the past 12 months, it still was better than expected and will raise hopes for next week's more important services PMI release. "The pound remains slightly lower on the week against the US dollar and is on course for a 6th weekly loss out of 7. You have to go back to last November to find a lower weekly closing price for this pair, although there have been some tentative signs of support in recent days with buyers stepping in to defend the 1.32 handle," he said. Following mixed European manufacturing surveys from around the continent, the eurozone PMI reading remained unchanged at 55.5. More importantly for the market mood, Italy swore in a new government, after President Sergio Mattarella gave his consent to a new populist coalition between the League and Five Star Movement overnight. A trio of academics were given the offices of prime minister, finance minister and minister of European affairs. Spain also prepared to swear in a new government as PM Mariano Rajoy was ousted, with socialist Pedro Sanchez taking over and saying he will attempt to garner support to govern and continue with the budget as agreed under his deposed predecessor. "Early elections are quite possible but the current balance of power in Spain is market friendly," says Ken Odeluga at City Index. US data in the afternoon beat estimates, with wage growth hitting 0.3%, the unemployment rate falling to an 18-year low of 3.8% and the headline non-farm payrolls number breezing past forecasts to 223,000. Odeluga said the jobs data did not perceptibly move the dial on the question of whether inflation might accelerate fast enough to force the Federal Reserve into a fourth interest rate hike this year. "That seems to be the key reason why stock markets have kept the risk lever tilted to the 'on' position. The "symmetric" quality the Fed introduced to its inflation target at the last meeting is balanced by upside risks—like tax cuts—which have yet to feed through much to the real economy, and downside risks to growth—chiefly an unpredictable impact from deteriorating trade relations." In UK corporate news, with Rio Tinto confirming completion of the sale of its 75% share of the Winchester South coal development project in Queensland for an up-front $150m cash, while ZPG confirmed the sale of Hometrack Australia for A$130m in cash. FirstGroup shares were up after Wolfhart Hauser, who has become executive chairman after chief executive Tim O'Toole was sacked on the back of major losses a day earlier, was reported as saying he would accept a bid for all or part of the company if an offer created value for shareholders. Sainsbury's came under political pressure after being asked to explain the reasoning behind a pay deal which could leave 9,000 staff worse off, by Rachel Reeves, chairwoman of the business, energy and industrial strategy committee, who is already closely scrutinising Sainsbury's proposed merger with Asda. Royal Dutch Shell announced production start at the Kaikias field in Gulf of Mexico, 12 months ahead of schedule. Ryanair said chief executive Michael O'Leary sold €33m worth of stock in the airline earlier in the week. Analysts at Morgan Stanley also provided a positive write-up for the Irish budget airline and UK rival easyJet following a series of positive short haul industry and highlighting several opportunistic expansion and pricing tailwinds for coming years. Inmarsat was higher as the International Maritime Organization's maritime safety committee approved the company's new service to support the Global Maritime Distress & Safety System. Ship owners and operators will now be able to combine maritime safety and broadband data services in a single FleetBroadband or Fleet One terminal provided by Inmarsat, the company said in a press release. Alfa Financial Group cratered on the back of a big profit warning from the software provider to the asset finance industry, which made the announcement after a contract delay by a major customer. Revenue guidance was cut and profits "will be materially below management's previous expectations". Shares in Dignity dived after the Competition & Markets Authority said it was launching a review into the £2bn funerals market to ensure that people are not getting a bad deal from pre-paid funeral plans. Meanwhile, electricity regulator Ofgem launched a probe into the way that Telecom Plus's Utility Warehouse manages its customers who are in debt, investigating whether the supplier has breached rules related to the way it manages these customers. In broker action, housebuilder Barratt Developments was boosted by an upgrade form JP Morgan to 'overweight' from 'neutral', while reversing that call and downgrading rival Taylor Wimpey to 'neutral' and Persimmon was reiterated at 'overweight'. Babcock International was higher after broker Stifel upgraded the defence contractor to 'buy' with a 950p target price, while analysts at Investec boosted challenger bank CYBG with an upgrade to 'hold'. Bank of Georgia was upgraded by Numis. | 
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