7th Apr 2025 07:53
(Alliance News) - Stocks were called lower in London on Monday, with US President Donald Trump professing a lack of concern over global market sell-offs as his aides reassured that negotiations were on the table.
"Last week marked the beginning of a historical market selloff," commented Swissquote's Ipek Ozkardeskaya. "The selloff on Friday accelerated after China said that they would respond to the US tariffs with 34% tariff on American imports on their own...Federal Reserve (Fed) President Jerome Powell said that the impact of tariffs on the US economy could be higher than expected, adding that there is no rush to cut rates. That was the last nail in the coffin."
She added: "So, if you're wondering where does the capital flow? It flows into the government bonds – the US, the German, the Japanese, the Australian yields are all down on the growing expectation that the financial turmoil will soon bring the central banks back to cutting rates and to purchasing bonds to ensure stability...
"The US 2-year yield is down to 3.50% despite Powell's message that there is no rush to cut rates. Investors know: if the selloff continues, the central banks will have no choice."
In corporate news, LondonMetric announced urban warehouse asset sales worth GBP40.4 million.
Here is what you need to know at the London market open:
----------
MARKETS
----------
FTSE 100: called down 245.5 points, 3.1% at 7,809.48
----------
Hang Seng: down 12% at 20,101.63
Nikkei 225: closed down 7.7% at 31,195.48
S&P/ASX 200: closed down 4.2% at 7,343.3
----------
DJIA: closed down 5.5%, at 38,314.86
S&P 500: closed down 6.0% at 5,074.08
Nasdaq Composite: closed down 5.8% at 15,587.79
----------
EUR: higher at USD1.1006 (USD1.0994)
GBP: lower at USD1.2897 (USD1.2931)
USD: lower her at JPY145.43 (JPY145.80)
GOLD: higher at USD3,027.90 per ounce (USD3,025.91)
OIL (Brent): lower at USD63.13 a barrel (USD65.38)
(changes since previous London equities close)
----------
ECONOMICS
----------
Monday's key economic events still to come:
10:00 BST eurozone retail sales
----------
US President Donald Trump said he will not back down on his sweeping tariffs on imports from most of the world unless countries even out their trade with the US. The president dug in on his plans to implement the taxes, which have sent financial markets reeling, raised fears of a recession and upended the global trading system. Speaking to reporters aboard Air Force One, Trump said he did not want global markets to fall, but also that he was not concerned about the massive sell-off either, adding: "Sometimes you have to take medicine to fix something." His comments came after his aides sought to soothe market concerns by saying more than 50 nations had reached out about launching negotiations to lift the tariffs. "I spoke to a lot of leaders, European, Asian, from all over the world," Trump said. "They're dying to make a deal. And I said, we're not going to have deficits with your country. We're not going to do that because to me, a deficit is a loss. We're going to have surpluses or, at worst, going to be breaking even." The higher rates are set to be collected from Wednesday, ushering in a new era of economic uncertainty with no clear end in sight. Trump, who spent the weekend in Florida playing golf, posted online: "WE WILL WIN. HANG TOUGH, it won't be easy."
----------
A top Chinese official has vowed to protect US firms and pledged his country will remain a "promising land" for foreign investment, Beijing said Monday after it slapped 34% tariffs on US imports. Beijing's tariffs "firmly protect the legitimate rights and interests of enterprises, including American companies", vice commerce minister Ling Ji told a panel of representatives of US companies on Sunday, his ministry said. Those levies – which come into effect on April 10 – "are aimed at bringing the US back onto the right track of the multilateral trade system", he told the representatives, including of electric vehicle firm Tesla, GE Healthcare and Medtronic. "The root cause of the tariff issue lies in the US," Ling said. He urged the firms to "take pragmatic actions to jointly maintain the stability of global supply chains and promote mutual cooperation and win-win outcomes". China said on Friday it would slap 34% tariffs on all imports of US goods, in retaliation for levies at the same level announced by US President Donald Trump.
----------
EU trade ministers are meeting in Luxembourg on Monday to sound out a strategy to convince US President Donald Trump to backtrack on new tariffs imposed on the bloc. EU ministers are also expected to discuss reciprocal tariffs as well as other retaliatory measures which would be implemented in case efforts to negotiate a solution with Washington fail. The US government introduced universal tariffs of a minimum of 10% on imports from almost all its trading partners on Saturday, after Trump announced them earlier last week. Significantly higher levies will apply for some countries, depending on trade deficits. Imports from EU countries to the US face new tariffs of 20% starting on Wednesday. Germany will be represented by outgoing Economy Minister Robert Habeck, who, like many of his EU counterparts fears that Trump's new tariffs will have serious consequences for the global economy. Trump says he aims to counter alleged trade imbalances while convincing manufacturers to produce in the US. He is also looking to fund large-scale tax cuts, a central campaign promise. Ministers will also discuss trade relations with China, with EU Trade Commissioner Maros Sefcovic due to brief them on his recent talks in Beijing.
----------
The Halifax house price index found that the average UK house price fell by 0.5% in March to GBP296,699, against a 0.2% decline to GBP298,274 in February. The annual rate of growth remained at 2.8%, unchanged from February, Halifax said. "House prices rose in January as buyers rushed to beat the March stamp duty deadline," commented Halifax Head of Mortgages Amanda Bryden. "However, with those deals now completing, demand is returning to normal and new applications slowing. Our customers completed more house sales in March than in January and February combined, including the busiest single day on record. Following this burst of activity, house prices, which remain near record highs, unsurprisingly fell back last month." She continued: "Looking ahead, potential buyers still face challenges from the new normal of higher borrowing costs, a limited supply of available properties to choose from, and an uncertain economic outlook. However, with further base rate cuts anticipated alongside positive wage growth, mortgage affordability should continue to improve gradually, and therefore we still expect a modest rise in house prices this year."
----------
Germany's trade surplus grew monthly in February as exports climbed faster than imports, data published by the Federal Statistical Office showed. The country's calendar and seasonally trade surplus climbed 9.3% to EUR17.7 billion in February from EUR16.2 billion in January. February's surplus however was still a notch lower than EUR17.8 billion pencilled in by the FXStreet-cited consensus. Exports grew 1.8% to EUR131.6 billion in February from EUR129.3 billion in January, while imports edged up 0.6% to EUR113.8 billion in February from EUR113.1 billion in January. Notably, the office said: "Most German exports in February 2025 went to the US. After seasonal and calendar adjustment, exports of goods to the US were up 8.5% compared with January 2025, with the value of exports to the US rising to EUR14.2 billion."
----------
UK Prime Minister Keir Starmer has pledged to "do everything necessary" to protect his country's national interest in the wake of Trump's tariffs, as he said that ministers are "ready to use industrial policy" to help shelter businesses. The prime minister said that "these new times demand a new mentality", after the 10% levy on British imports into America came into force on Saturday morning, while a 25% levy on foreign car imports came into force on Thursday. The government on Sunday unveiled plans to give carmakers more flexibility in transitioning to electric vehicles in a bid to boost the sector in the face of "global economic headwinds". Under the new plans, carmakers can fall below the annual target for producing electric vehicles manufactured until 2026, if they make up for that shortfall before 2030. The package of measures will exempt small and micro-volume manufacturers, including supercar brands such as McLaren and Aston Martin, from the targets. Vans with an internal combustion engine will be allowed to be sold until 2035. However, the government confirmed that all petrol and diesel car sales will be outlawed by 2030, with hybrids to be sold until 2035 and small manufacturers exempt.
----------
More than 300 jobs will be created as a result of a GBP450 million investment programme in north Scotland's electricity distribution network. Scottish & Southern Electricity Networks Distribution, SSEN, said the jobs will be created as it announced the names of the contract partners with which it is working across nine sub-regions of the north Scotland network area. It is hoped the work will boost network resilience. The area has a harsher climate compared with the rest of the country. The work will also support low-carbon energy technology and decarbonised industries, and increase reliability for customers. SSEN's network of wooden poles and overhead lines will be renewed, and substations will be updated. The energy provider says this will lead to more than 300 new jobs in Scotland by the time the new decade comes around, and will be crucial in delivering new technologies like EV chargers, solar panels and heat pumps.
----------
BROKER RATING CHANGES
----------
Barclays raises Mondi to 'equal weight' (underweight) - price target 1,100 (1,110) pence
----------
RBC raises Currys price target to 130 (125) pence - 'outperform'
----------
RBC cuts Fevertree Drinks price target to 900 (1,000) pence - 'sector perform'
----------
COMPANIES - FTSE 100
----------
LondonMetric has sold GBP40.4 million of mature and non-core urban warehousing, reflecting a net initial yield of 4.3%. The London-based REIT said the five assets have been sold in separate transactions to owner occupiers and long only funds, and comprise three London warehouses in Walthamstow, Park Royal and Croydon, sold for GBP30.8 million and reflecting a NIY of 3.9%; and two warehouses in Birmingham and Aberdeen, sold for GBP9.6 million and reflecting a NIY of 5.7%. It said the sales are in line with September 30 book values and have delivered a profit on cost of 30% and an ungeared IRR of 10%. LondonMetric also noted that over the year to March 31 2025, LondonMetric has sold over 70 assets for GBP347 million [LondonMetric share: GBP342 million] at 1.6% above prevailing book values.
----------
COMPANIES - FTSE 250
----------
Ferrexpo reported a production increase but said this would not improve earnings due to high input costs. For the quarter ended March, the Baar, Switzerland-based miner said total commercial production was 2.13 million tonnes, "comprising 1.3 million tonnes of pellets and [777,718] tonnes of 67% iron concentrate due to a strong increase in high grade concentrates sold to customers in Asia". This was up from total production of 2.05 million tonnes, 1.8 million tonnes of pellets and 240,516 of commercial concentrate in the first quarter of 2024. "For the first quarter of 2025, total commercial production was the highest quarterly rate since the full-scale invasion started in February 2022," Interim Executive Chair Lucio Genovese noted. However: "The increase in production however did not translate into improved earnings because of sustained high input costs, in particular imported electricity and deteriorating iron ore pellet premiums and prices. The environment in which we are operating has become increasingly challenging."
----------
OTHER COMPANIES
----------
All Things Considered announced the acquisition of a majority interest [75%] in music management and record label company Easy Life Entertainment. "With an established music catalogue built up over 10 years, Easy Life Entertainment enjoys a long-term revenue stream with consistent returns, generated from its music rights royalties," All Things Considered explained. "The acquisition also brings new opportunities to cross-sell additional integrated services across an enlarged customer base, such as representation, live events, and merchandising, further enhancing long-term value for the business." The music talent management, live booking and merchandising firm said the acquisition cost net GBP750,000 [approximately], "after netting off a post-completion dividend due to ATC of approximately [GBP280,000]".
----------
Smarttech247 announced it has been appointed to a multi-year cybersecurity framework agreement with "a major international airport" in London. The cybersecurity services provider said the contract has a total potential value of up to GBP7 million across all four suppliers over its five-year term, with a further one-year extension available. "While the agreement does not guarantee minimum spend, it establishes Smarttech247 as a trusted provider to one of the UK's most high-profile transport hubs, offering a significant opportunity to generate meaningful revenues over the life of the agreement," the firm added. CEO Raluca Saceanu commented: "This win reflects the group's continued execution against its strategy to grow through high-value, long-term engagements with critical national infrastructure clients. It is also a significant opportunity for us to potentially deliver cybersecurity services in a highly regulated and high-security setting over the coming years."
----------
By Emma Curzon, Alliance News reporter
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.
Related Shares:
MondiCurrysFevertreeLondonMetricFerrexpoAtlantic CoalAston Martin Lagonda