27th Feb 2025 06:56
(Alliance News) - Stocks in London are set to open in the red on Thursday, following US President Donald Trump's threat of 25% tariffs against the EU for cars and other products.
Speaking at a cabinet meeting, Trump described the EU – whose creation was encouraged for decades by Washington – as being "formed in order to screw the US". He also signalled that levies against Canada and Mexico will take effect in early April.
IG says futures indicate the FTSE 100 to open down 12.5 points, 0.1%, on Thursday. The index of London large-caps closed 0.7% higher at 8,731.46 on Wednesday.
In more positive local news economist Swati Dhingra, who is a member of the Bank of England's Monetary Policy Committee, has said that while future global economic growth hinges on how US tariffs affect trade, the impact on UK inflation could be relatively limited.
The "direct price-increasing effects from US tariffs to UK prices" could be "less than feared" as the main imports, including refined oil, are unlikely to experience cost increases on account of tariffs, Dhingra said.
She added: "On the overall impact on inflation in the UK, the direct effect of US import costs and dollar strengthening are likely to be offset by reduced global price pressures."
Sterling was quoted at USD1.2661 early Thursday, lower than USD1.2692 at the London equities close on Wednesday.
The euro traded at USD1.0471 early Thursday, lower than USD1.0509 late Wednesday. Against the yen, the dollar was quoted flat at JPY149.25.
In the US on Wednesday, Wall Street ended mixed, with the Dow Jones Industrial Average down 0.4%, the S&P 500 up 0.81 points and the Nasdaq Composite up 0.3%.
In Asia on Thursday, the Nikkei 225 index in Tokyo was up 0.3%. The Shanghai Composite in China and the Hang Seng index in Hong Kong were both up 0.2%. The S&P/ASX 200 in Sydney closed up 0.3%.
Gold was quoted at USD2,896.63 an ounce early Thursday, lower than USD2,912.10 on Wednesday.
Brent oil was trading at USD72.23 a barrel early Thursday, lower than USD72.83 late Wednesday.
In Thursday's corporate calendar, a busy docket includes full-year results from Haleon, Aviva, Hiscox and the London Stock Exchange Group.
In the economic calendar on Thursday, France releases producer price inflation data and a slew of US releases includes initial jobless claims and quarterly personal consumption expenditures.
By Emma Curzon, Alliance News reporter
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.