23rd Apr 2025 06:47
(Alliance News) - Stocks in London are set to open higher on Wednesday, as US President Donald Trump appears to backtrack on threats to oust the Federal Reserve chair and the US Treasury Secretary expects a de-escalation in trade tensions between the US and China.
IG says futures indicate the FTSE 100 to open up 91.1 points, 1.1% at 8,419.70 on Wednesday. The index of London large-caps closed up 52.94 points, 0.6%, at 8,328.60 on Tuesday.
Sterling was quoted at USD1.3312 early Wednesday, lower than USD1.3383 at the London equities close on Tuesday.
The euro traded down at USD1.1391 early Wednesday, against USD1.1479 late Tuesday. Against the yen, the dollar was quoted higher at JPY141.89 versus JPY140.73.
US President Donald Trump said he has no plans to fire Federal Reserve Chair Jerome Powell, whom he has recently berated in criticism that sparked market turmoil.
"I have no intention of firing him," Trump said. "I would like to see him be a little more active in terms of his idea to lower interest rates – it's a perfect time to lower interest rates."
A top economic aide on Friday had reported that Trump and his administration were studying whether dismissing Powell was an option. The US president does not have direct authority to fire Federal Reserve governors, though Trump could initiate a lengthy process to attempt to unseat Powell by proving there was "cause" to do so.
Brent oil was trading higher at USD67.98 a barrel early Wednesday, from USD67.62 late Tuesday.
"The reversal in Trump’s tone towards Powell's tenure as Fed chair and a more constructive feel towards US-China relations has seen crude push into USD65, where once again traders seem happy to sell into the rally, and the level seems to be a barrier that the crude bulls want to see break," commented Pepperstone analyst Chris Weston.
"Clearly, the greater sensitivities to the Powell/US-China headlines have been observed in the well owned "sell America" trades – long gold, short USD and S&P 500 futures – but crude has taken in the tailwinds from the reduction in cross asset volatility and the general feeling that we're averting a policy mistake in Trump's push for Powell's early removal."
In the US on Tuesday, Wall Street ended higher, with the Dow Jones Industrial Average climbing 2.7%, the S&P 500 improving 2.5% and the Nasdaq Composite edging up 2.7%.
The trade stand-off between Washington and Beijing is not sustainable, US Treasury Secretary Bessent said, predicting the tit-for-tat tariff war would de-escalate soon.
Speaking at a closed-door event hosted by JPMorgan Chase, Bessent said the enormous tariffs the world's two biggest economies placed on each other's imports amounted to a reciprocal trade embargo.
Bessent told the event that he expects a de-escalation in the near future, according to a person who was in the room.
In Asia on Wednesday, the Nikkei 225 index in Tokyo was 1.8% higher. In China, the Shanghai Composite rose 0.2%, while the Hang Seng index in Hong Kong was up 2.5%. The S&P/ASX 200 in Sydney closed 1.5% higher.
President Vladimir Putin has offered to halt Russia's invasion of Ukraine on the current front line, the Financial Times reported Tuesday.
According to the FT, which quotes "people familiar with the matter", Putin made the proposal during a meeting with US envoy Steve Witkoff in St Petersburg earlier this month. The Russian leader indicated he would be willing to withdraw Moscow's claims to parts of Donetsk, Luhansk, Kherson and Zaporizhzhia – four regions it partially occupies.
In return, the US might accede to Russia's other major demands, according to the FT, including recognising its sovereignty over the Crimean peninsula, annexed in 2014, and barring Ukraine from joining Nato.
Gold was quoted at USD3,329.61 an ounce early Wednesday, down from USD3,425.98 on Tuesday and continuing its retreat from a record high of USD3,500.12 early Tuesday.
In Wednesday's corporate calendar, trading statements from consumer products firm Reckitt Benckiser, speciality chemicals company Croda and estate agent Foxtons.
In the economic calendar on Wednesday, a slew of PMI readings across the globe, including the UK, US and eurozone.
By Emily Parsons, Alliance News reporter
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