12th Aug 2025 12:11
(Alliance News) - Blue-chip stocks in Europe were largely higher on Tuesday afternoon, with tariff optimism lifting the mood, as the US and China agreed a truce extension.
As part of their May truce, fresh US tariffs targeting China were reduced to 30% and the corresponding level from China was cut to 10%. Those rates will now hold until November – or whenever a deal is cut before then.
Around the same time that Trump confirmed the new extension, Chinese state media Xinhua news agency published a joint statement from US-China talks in Stockholm saying it would also extend its side of the truce.
"Markets reacted with relief to news of an extension on the US-China trade deadline which was set to expire today," AJ Bell analyst Russ Mould commented. "However, this relief was measured given the market had largely anticipated such an outcome."
The FTSE 100 index rose 14.53 points, 0.2%, at 9,144.24. The FTSE 250 fell 33.15 points, 0.2%, at 21,856.34, and the AIM All-Share was up 0.54 of a point, 0.1%, at 758.75.
The Cboe UK 100 was up 0.1% at 914.51, the Cboe UK 250 was 0.1% lower at 19,242.72, and the Cboe Small Companies was up 0.1% at 17,127.62.
In European equities on Tuesday, the CAC 40 in Paris was up 0.1%, while the DAX 40 in Frankfurt was down 0.4%.
Stocks exposed to China were on the up in London, after the extension was announced, Asia-focused lender Standard Chartered added 1.6%, while miner Rio Tinto rose 1.5%. Elsewhere in the mining sector, Antofagasta advanced 1.4% and BHP, no longer a FTSE 100 constituent, climbed 1.0%. China is a major buyer of minerals.
The pound rose to USD1.3462 on Tuesday afternoon, from USD1.3402 at the time of the London equities close on Monday. The euro traded at USD1.1610, up from USD1.1591. Against the yen, the dollar rose to JPY148.45 from JPY148.09.
The UK unemployment rate was unmoved in June, numbers on Tuesday showed, while an early estimate showed the monthly decline in payrolled employees eased in July.
The Office for National Statistics said the rate of unemployment in the three months to June remained at 4.7%, where it also had stood in the three months to May. Compared to the three months to March, however, the unemployment rate picked up from 4.5%.
Rabobank analysts commented: "The market will continue to follow the evolution of both UK wage and CPI inflation in its attempt to predict whether the BoE can continue its recent policy of quarterly rate cuts. Despite the moderate cooling in the labour market in June, UK weekly earnings ex-bonuses held steady, as expected, at 5% [in the three months to June year-on-year]. This is well above the levels that are seen to be consistent with the BoE's 2% CPI inflation target."
The yield on the 10-year US Treasury was unchanged at 4.28%. The yield on the 30-year remained at 4.85%.
In New York, the Dow Jones Industrial Average is called up 0.1%, while the S&P 500 and Nasdaq Composite are called to open flat.
Still to come on Tuesday is a US inflation reading at 1330 BST.
Rostro analyst Joshua Mahony commented: "Looking ahead, todays US CPI inflation release provides us with fresh insights over the direction of travel for US prices given the trade measures implemented by the president. Last month’s 0.3% monthly CPI figure represented the highest in five months, with underlying metrics highlighting particular gains in tariff related goods such as clothing and consumer electrics. Given the fact that many businesses would have stockpiled ahead of Trump’s tariffs, there is likely a lag between implementation and the point of which those businesses start paying the new rate for imported goods. With that in mind the possibility of a rebound in US inflation remains a significant risk for markets, calling into question the recent payroll’s led spike in rate cut expectations."
Thermal energy and fluid technology company Spirax backed its annual outlook but reported a decline in half-year earnings. The stock jumped 12%.
Pretax profit in the first six months of 2025 declined 30% to GBP87.9 million from GBP124.8 million a year prior. Revenue fell 0.6% to GBP822.2 million from GBP827.0 million. On an organic basis, revenue rose 3% on-year.
"We have delivered first half results in line with expectations despite the challenging macroeconomic environment, demonstrating the strength of the group's direct sales business model," Chief Executive Officer Nimesh Patel said.
Spirax raised its interim dividend by 2.9% to 48.9p from 47.5p.
"Our group guidance for the full year remains unchanged. We continue to anticipate organic growth in group revenues consistent with that achieved in 2024 and well ahead of [industrial production growth]," Spirax said. "Group adjusted operating profit margin is expected to be ahead of the currency adjusted 19.4% in 2024, driving mid-single digit organic growth in adjusted operating profit."
Atalaya Mining shot up 6.8%. The mining company said pretax profit rose to EUR75.8 million in the six months to June 30 from EUR18.2 million a year earlier, as revenue climbed to EUR254.8 million from EUR162.1 million.
In the second quarter, pretax profit increased to EUR38.3 million from EUR16.1 million. Revenue came to EUR124.1 million, up from EUR92.2 million the year before.
Atalaya reported copper production of 27,466 tonnes in the first half, up from 22,249 a year prior.
Looking ahead, Atalaya narrowed its 2025 copper production guidance to between 49,000 and 52,000 tonnes, from 48,000 to 53,000 tonnes previously.
Also, Atalaya lowered its cost outlook. It now anticipates cash costs between USD2.60 and USD2.80 per pound, compared with the previous range of USD2.70 to USD2.90.
A barrel of Brent rose to USD66.57 midday Tuesday, from USD66.49 at the time of the London equities close on Monday. Gold fell to USD3,342.48 an ounce from USD3,347.03.
By Eric Cunha, Alliance News news editor
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