9th Apr 2025 07:53
(Alliance News) - London's FTSE 100 is called to open lower on Wednesday following the announcement of new further US tariffs on China, and global markets brace themselves for further turmoil.
Asian markets were in the red on Wednesday alongside their US peers, while gold began to rebound following its retreat from a record high.
"With global supply chains still fragile, escalating tensions between the US and China could have severe consequences for multinational corporations — particularly in manufacturing, technology, and retail, sectors that are heavily reliant on Asian supply sources," XS.com analyst Linh Tran commented.
"The three largest sectors in the Dow Jones index — industrials, technology, and consumer discretionary — are now at the center of selling pressure due to these growing concerns."
In early corporate news, Assura rejects another takeover bid from Primary Health Properties, and Oxford BioMedica announced a narrowed annual loss.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called down 3.3% at 7,654.53
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Hang Seng: down 0.4% at 20,047.21
Nikkei 225: closed down 3.2% at 31,964.84
S&P/ASX 200: closed down 2.1% at 7,356.30
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DJIA: closed down 320.01 points, or 0.8%, at 37,645.59
S&P 500: closed down 79.48 points, or 1.6%, at 4,982.77
Nasdaq Composite: closed down 335.35 points, or 2.2%, at 15,267.91
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EUR: up at USD1.1054 (USD1.0914)
GBP: up at USD1.2822 (USD1.2772)
USD: down at JPY145.49 (JPY146.95)
Gold: up at USD3,031.45 per ounce (USD3,009.89)
(Brent): down at USD61.29 a barrel (USD63.95)
(changes since previous London equities close)
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ECONOMICS
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Wednesday's key economic events still to come:
13:30 BST eurozone European Central Bank executive board member Piero Cipollone speaks
UK Delphi Economic Forum
15:00 BST US wholesale inventories
15:30 BST US EIA crude oil stocks
19:00 BST US FOMC minutes
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Additional US tariffs on Chinese imports are set to reach 104% on Wednesday, the White House told AFP, as Washington doubles down on planned action after Beijing vowed a "fight to the end" on levies. US President Donald Trump had vowed a further 50% tariff on goods from China if Beijing did not retract upcoming retaliation – and the White House confirmed that Trump will proceed with this action, taking the overall added duties this year to 104%.
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Britain is "accelerating trade deals with the rest of the world," Chancellor Rachel Reeves insisted as more of Donald Trump's global tariffs came into effect on Wednesday after a week of market turmoil. Countries across the globe have been braced for potential widespread economic damage from the import taxes on goods entering the US from midnight Washington time – just after 0500 BST. The chancellor and Business secretary will later meet India's finance minister for talks aimed at negotiating a deal with the country as the chancellor said she wanted to create "the best possible conditions" for British business in a "changing world".
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Beijing filed a complaint at the WTO over US tariffs on Chinese goods, saying they "seriously undermine the rules-based multilateral trading system." In a letter to the WTO, China said the 34% tariffs set to take effect on Wednesday violate international trade rules. It described the US measures as "discriminatory and protectionist in nature" and asked for bilateral talks to resolve the dispute.
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China has issued a fiery response after US Secretary of Defence Pete Hegseth said it poses an ongoing threat to the Panama Canal. Speaking at a ribbon cutting for a new US-financed dock at the Vasco Nunez de Balboa Naval Base after a meeting with Panama President Jose Raul Mulino, Hegseth said the US will not allow China or any other country to threaten the canal's operation. His remarks triggered the response from the Chinese government, which said: "Who represents the real threat to the Canal? People will make their own judgement." Hegseth said: "The US and Panama have done more in recent weeks to strengthen our defence and security cooperation than we have in decades. China-based companies continue to control critical infrastructure in the canal area. "That gives China the potential to conduct surveillance activities across Panama. This makes Panama and the US less secure, less prosperous and less sovereign. And as president Donald Trump has pointed out, that situation is not acceptable."
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Trump has signed executive orders to "turbocharge coal mining" to "more than double" electricity production to keep up with power-hungry artificial intelligence technology. The executive orders will lift regulatory barriers to coal extraction and suspend the planned closures of numerous coal-fired power plants across the country. "We will end the government bias against coal," said the Republican president, who instructed the Department of Justice to identify and fight any state or local regulations that were "putting our coal miners out of business."
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BROKER RATING CHANGES
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Goldman Sachs raises AstraZeneca price target to 15,318 (15,130) pence - 'buy'
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Barclays cuts Wizz Air price target to 900 (1,000) pence - 'underweight'
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Berenberg cuts Central Asia Metals price target to 190 (200) pence - 'hold'
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COMPANIES - FTSE 100
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DCC taps Conor Murphy as its new chief financial officer, effective from the firm's annual general meeting on July 10. Murphy will replace Kevin Lucey in the role, who will at the AGM step into the chief operating officer position. The chief executive officer of DCC Energy, Fabian Ziegler, will leave DCC in July. "We announced decisive actions in November to simplify our group, pursue our largest growth and returns opportunity in energy and unlock substantial shareholder value," said DCC CEO Donal Murphy. "In the energy sector we are building a unique, multi-energy, sustainable business. Our new leadership team has extensive experience in the energy sector and the commercial agility and drive to build DCC into a global energy leader. We will also drive the growth and development of the Healthcare and Technology divisions while they remain part of the group."
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COMPANIES - FTSE 250
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Merchants Trust reported a net asset value total return of 13.5% during the financial year that ended January 31, falling short of a 17.1% return on its benchmark, the FTSE All-Share index. The trust swung to a pretax profit of GBP104.8 million for the year, from a loss of GBP29.5 million a year prior, and declared a final dividend of 7.3 pence per share. This brought the total dividend for the year to 29.1p, up 2.5% on-year from 28.4p. "While Merchants Trust does maintain a significant exposure to the larger companies in the index, our investment philosophy prioritises value," said Chair Colin Clark. "This leads to a larger allocation in mid- and small-cap stocks, which tend to be more domestically focused and cyclical in nature. As equity markets during this period were driven by momentum, growth, and technology stocks, these smaller companies underperformed." Merchants Trust remained "optimistic" in meeting its long-term objectives.
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Assura rejected a takeover bid from peer Primary Health Properties, concluding it was "not at a level that is sufficient to be recommended to shareholders". PHP had submitted an offer that would see Assura shareholders receive 0.3848 new PHP shares and 9.08 pence in cash for each Assura share, in an attempt to outbid a US private equity consortium comprised of Kohlberg Kravis Roberts & Co Partners and USS Investment Management. Based on the PHP closing share price of 94.35p on Wednesday last week, the offer had implied a value of 46.2p for each Assura share, valuing all of Assura at GBP1.5 billion. Early last month, PHP offered 43p per share for Assura. But Assura snubbed this March 12 offer, backing KKR-led offer that valued it at 49.4p each. KKR has until Friday to make a firm takeover offer.
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OTHER COMPANIES
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Oxford BioMedica said its pretax loss narrowed to GBP47.3 million during 2024, from GBP188.5 million in 2023. Revenue grew 44% to GBP128.8 million from GBP89.5 million, while operating costs were reduced by 34% to GBP57.3 million from GBP86.2 million. The firm's loss before interest, tax, depreciation and amortisation narrowed to GBP15.3 million from GBP52.8 million. "With our strong commercial momentum and the successful execution of our strategy, we are on track to achieve significant revenue growth consistent with our medium-term guidance and well above industry levels," said Chief Executive Officer Frank Mathias. "Through continued focus on efficiency and a disciplined approach to our cost base, we also expect to achieve operating Ebitda profitability for FY 2025." Oxford BioMedica forecasts revenue growth at a compound annual growth rate of more than 35% from 2023 to 2026.
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By Emily Parsons, Alliance News reporter
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Related Shares:
AstrazenecaWizz AirCentral Asia MetalsDCCMerchants TrustAssuraPrimary HealthOxford Biomedica