2nd Oct 2025 06:59
(Alliance News) - Stocks in London are set to open higher on Thursday, following a record close on Wednesday, as US President Donald Trump delayed new tariffs on pharmaceutical companies.
IG says futures indicate the FTSE 100 to open 36.2 points higher, up 0.4%, at 9,482.63 on Thursday. The index of London large-caps closed up 1.0% at 9,446.43, beating its previous record close on Tuesday.
"While there are still three months of the year left to run, if things ended now, this would mark the London benchmark’s best year since all the way back in 2009," noted Pepperstone analyst Michael Brown.
Sterling was at USD1.3478, up slightly from USD1.3477 at the London equities close on Wednesday. The euro traded at USD1.1734, up from USD1.1729 late Wednesday. Against the yen, the dollar was slightly higher at JPY147.18 versus JPY147.15.
The yield on the 10-year US Treasury narrowed to 4.11% on Thursday from 4.13% on Wednesday. The yield on the 30-year was unchanged at 4.72%.
Efforts to swiftly end the US government shutdown collapsed as Democrats in Congress went home without resolving an acrimonious funding stand-off with President Donald Trump and the White House threatened public sector jobs.
With the government out of money after Trump and lawmakers failed to agree on a deal to keep the lights on, federal departments have been closing since midnight yesterday, with the White House warning of "imminent" firings of public sector workers.
Senate Democrats – who are demanding extended health care subsidies for low income families – refused to help the majority Republicans approve a House-passed bill that would have reopened the government for several weeks while negotiations continue.
With the Senate now adjourned until Friday, hopes for a quick resolution have been frustrated. Around 750,000 federal employees are expected to be placed on furlough – a kind of enforced leave, with pay withheld until they return to work.
Brown said: "My view remains that any equity dips on the back of ‘shutdown fears’ should be faded, with dips continuing to be viewed as buying opportunities, as the path of least resistance leads clearly to the upside amid a resilient underlying economy, solid earnings growth, and a looser monetary backdrop – with 25 basis point Fed cuts in October, and December, pretty much nailed on."
The new tariffs on pharmaceutical imports into the US, announced by Trump for October 1, have been postponed for now, according to government sources.
Instead, the Trump administration will begin preparing tariffs targeting pharmaceutical companies that refuse to relocate production to the US or lower their prices, a senior US official told dpa on Wednesday, without giving a reason for the delay.
In the US on Wednesday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.1%, the S&P 500 gained 0.3% and the Nasdaq Composite was 0.4% higher.
In Asia on Thursday, the Nikkei 225 index in Tokyo was up 1.1%. In China, the Shanghai Composite was 0.5% higher, while the Hang Seng index in Hong Kong climbed 1.6%. The S&P/ASX 200 in Sydney gained 1.2%.
Gold was higher at USD3,867.20 an ounce early on Thursday from USD3,862.37 late Wednesday. Brent oil was trading higher at USD65.66 a barrel from USD65.53.
Thursday's global economic calendar has eurozone unemployment data. Meanwhile, US weekly jobless claims figures and factory orders figures which had been scheduled for release will not be published due to the US government shutdown.
Thursday's UK corporate calendar has half-year results from the UK's largest retailer, Tesco.
By Michael Hennessey, Alliance News reporter
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.