4th Apr 2025 06:51
(Alliance News) - Stocks in London are set to open lower again on Friday, as investors continue to digest the impact of US "Liberation Day" tariffs and the UK government deliberates its response.
IG says futures indicate the FTSE 100 to open down 17.2 points, 0.2%, at 8,730.54 on Friday. The index of London large-caps closed down 133.74 points, 1.6%, at 8,474.74 on Thursday.
The UK is braced for more market chaos on Friday as the government considers its response to US President Donald Trump's tariffs. Ministers have insisted they will respond with "cool and calm heads", but are keeping all options open, including the possibility of retaliatory tariffs on a range of American goods.
An "indicative list" published by the government showed products that could be targeted, including bourbon whiskey, motorcycles, guitars and jeans.
But an immediate response is unlikely as Trade Secretary Jonathan Reynolds told MPs he would hold a four-week consultation on retaliatory action.
The government still hopes for an "economic deal" with the US to secure some exemption from the tariffs, with Prime Minister Keir Starmer promising businesses on Thursday that he would "fight for the best deal for Britain".
Sterling was quoted at USD1.3090 early Friday, lower than USD1.3114 at the London equities close on Thursday.
The euro traded at USD1.1081 early Friday, lower than USD1.1047 late Thursday. Against the yen, the dollar was quoted down at JPY145.79 from JPY146.11.
"After 'Liberation Day' on Wednesday, came 'liquidation day' on Thursday, as participants de-risked their books, and sought shelter away from the ongoing tariff storm," said Pepperstone analyst Michael Brown.
"Of course, it shouldn't be at all surprising that fallout from Trump’s tariff announcements continued through the day, with countries around the world responding with both rhetoric and retaliatory measures of their own, and as market participants re-assessed their macro assumption as those 'reciprocal' levies fell right at the harshest end of what had been expected."
On Wednesday, US President Donald Trump put minimum tariffs of 10% on most imports into the US but higher punitive tariffs are due for many countries, depending on their trade deficits.
However, Trump on Thursday suggested he is open to negotiations.
"If somebody said that we're going to give you something that's so phenomenal, as long as they're giving us something that's good," Trump said when asked if he would consider deals with affected countries.
The tariffs would give the US "great power" to negotiate, the US president added.
In the US on Thursday, Wall Street ended lower, with the Dow Jones Industrial Average slipping 4.0%, the S&P 500 falling 4.8% and the Nasdaq Composite fading 6.0%.
In Asia on Friday, the Nikkei 225 index in Tokyo was down 3.6%. In China, the Shanghai Composite was down 0.2%, while the Hang Seng index in Hong Kong was 1.5% lower. The S&P/ASX 200 in Sydney closed down 2.4%.
US President Donald Trump's tariffs on Japanese goods are a "national crisis", Prime Minister Shigeru Ishiba said Friday ahead of cross-party talks on mitigating the impact.
Japanese firms are the biggest investors into the US but Trump on Thursday announced a hefty 24% levy on imports from the close US ally as part of global "reciprocal" levies.
The measures "can be called a national crisis and the government is doing its best with all parties" to lessen the impact, Ishiba said in parliament.
He called however for a "calm-headed" approach to negotiations with Trump's administration, which has also imposed 25% tariffs on auto imports which came into force this week.
Democratic officials in 19 US states have filed a lawsuit against Trump's attempt to reshape elections. The lawsuit, filed on Thursday, called the president's move an unconstitutional invasion of states' clear authority to run their own elections.
It seeks to block key aspects of it, including new requirements that people provide documentary proof of citizenship when registering to vote and a demand that all mail ballots be received by election day. The lawsuit is the fourth against the executive order issued just a week ago.
"The president has no power to do any of this," the state attorneys general wrote in court documents.
Gold was quoted at USD3,102.65 an ounce early Friday, lower than USD3,109.85 on Thursday and continuing its retreat from a record high of USD3,167.69 late on Wednesday.
Brent oil was trading at USD69.50 a barrel early Friday, slipping from USD69.80 late Thursday.
In the economic calendar on Friday, US nonfarm payrolls at 1330 BST.
By Emily Parsons, Alliance News reporter
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