StockMarketWire.com - UK stocks opened lower on Wednesday as investors continued to fret about the frosty state of trade relations between the US and China and local tobacco companies were hit by rival merger talks.

At 0857, the benchmark FTSE 100 index was down 16.42 points, or 0.2%, at 7.073.16.

British American Tobacco and Imperial Brands both fell 1.8% after US rival Philip Morris announced merger talks to reunite with previous spin-off Altria.

Struggling travel company Thomas Cook dropped 13% to 6.15p after it agreed key terms of a rescue deal with China's Fosen and its debt holders that could see its shares delisted.

Fosen agreed to pay £450m for 75% of the company's tour operator unit and 25% of its airline, while lenders would provide another £450m converting existing debt into 75% of the airline and 25% of the tour operator.

Oil services group Petrofac lost 0.8% to 402.9p, despite swinging to a first-half profit, after it said its order intake had been hurt amid a Serious Fraud Office probe into its contract dealings in Saudi Arabia and Iraq.

Petrofac also warned that its revenue would fall next year.

Marine contractor James Fisher and Sons dropped 5.9% to 2000p after it booked a 3% fall in first-half profit, owing to a slow start to the year at its marine support business.

Fashion retailer Ted Baker advanced 1.6% to 926.5p, on announcing that it had agreed to an exclusive licence deal in Japan with Sojitz Infinity.

Book and convenience retailer WH Smith gained 0.1% to 1995p after it said its travel business continued to grow 'strongly' in the year through August, with sales improvements recorded across all of its channels.

Its weaker high street business, meanwhile, performed as expected, with cost savings and margin improvements delivered to plan, the company added.

AstraZeneca added 0.2% to 7,251p as it revealed positive results from a clinical trial of a treatment combination for chronic obstructive pulmonary disease.

Specialised technical product supplier Diploma gained 2.5% to 1590p after if forecast a 13% rise in annual revenue, coupled with an improvement in operating margins.

Online education group Wey Education rallied 14% to 10.33p on announcing that its annual adjusted profits would be 'at least' in line with expectations following a jump in revenue.

President Energy slumped 14% to 5.4p, having deferred its 2019 drilling campaign in Argentina after the government introduced caps on fuel prices.

Spend management group Proactis shed 2.0% to 50p, despite revealing that it had received a number of early expressions of interest from a formal sales process of the company in July.

Proactis also said it expected its revenue for the year through July to rise to £54.1m, up from £52.2m, but its adjusted Ebitda to fall to £15.0m, down from £17.3m.

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