5th Feb 2025 06:57
(Alliance News) - London's FTSE 100 is once again called to open lower on Wednesday, as trade tensions continue to overshadow equities.
IG says futures indicate the FTSE 100 to open 27.4 points lower, 0.3%, at 8,543.37 on Wednesday. The index of London large-caps closed down 12.79 points, 0.2%, at 8,570.77 on Tuesday.
Both the CAC 40 in Paris and the DAX 40 in Frankfurt are called to open 0.4% lower.
In one of the latest developments, the US Postal Service said Tuesday it was temporarily suspending inbound parcels from China and Hong Kong, shortly after President Donald Trump's imposition of fresh tariffs targeting Beijing.
The halt will take place "until further notice," and follows Trump's order for an additional 10% levy on Chinese imports starting Tuesday.
SPI Asset Management analyst Stephen Innes commented: "This wasn’t on anyone’s radar, and the reaction was swift—Chinese stocks took a hit, adding another layer of uncertainty to an already volatile trade landscape."
The Shanghai Composite fell 0.7% in afternoon trade. It was the first time the Shanghai market re-opened after the Chinese New Year break. The Hang Seng Index in Hong Kong was down 1.1%. Tokyo's Nikkei 225 was fractionally higher, while the S&P/ASX 200 in Sydney added 0.5%.
Against the dollar, the pound was flat at USD1.2480 early Wednesday, from USD1.2481 at the time of the London equities close on Tuesday. The euro rose to USD1.0387 from USD1.0376. Against the yen, the dollar faded to JPY153.20 from JPY154.58.
The yen was supported by numbers showing pay growth in Japan picked up. Total cash earnings rose 4.8% in December from a year prior, picking up speed from a 3.9% hike in November. The latest figure topped the FXStreet cited consensus of a 3.8% rise.
ING analysts commented: "Labour cash earnings rose more than expected in December and the November figures were all revised upwards. If Shunto results are as strong as last year's, we expect the Bank of Japan to hike by 25 basis points as early as May."
A barrel of Brent fell to USD76.05 early Wednesday from USD76.19 at the time of the closing bell in London on Tuesday. Gold rose to USD2,860.53 an ounce from USD2,840.78. It spiked to another record high of USD2,861.92.
In New York on Tuesday, the Dow Jones Industrial Average rose 0.3%, the S&P 500 added 0.7% and the Nasdaq Composite surged 1.4%.
Wednesday's UK corporate calendar sees full-year results from pharmaceuticals firm GSK plus a trading statement from electricity generator SSE.
The economic calendar for Wednesday has a raft of composite PMI readings, ADP private payrolls figures in the US and eurozone PPI data.
By Eric Cunha, Alliance News news editor
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