11th Apr 2025 11:58
(Alliance News) - Stock prices in London were mostly higher at midday on Friday, while overseas China has announced it will raise tariffs on US goods to 125%, effective Saturday, but will ignore further levies by US President Donald Trump.
However, the Chinese finance ministry said further action by the US will be ignored because "at the current tariff level, there is no possibility of market acceptance for US goods exported to China".
"The US imposition of round upon round of abnormally high tariffs on China has become a numbers game with no practical significance in economics," the commerce ministry said. A spokesperson added: "If the US continues to play the tariff numbers game, China will ignore it."
Beijing also said that Trump's decision to freeze tariffs on other countries came partly after "pressure from China".
The FTSE 100 index was up 65.05 points, 0.8%, at 7,978.30. The FTSE 250 was down 6.94 points at 18,510.47, and the AIM All-Share was up 3.12 points, 0.5%, at 648.09.
The Cboe UK 100 was up 0.7% at 795.11, the Cboe UK 250 was down 0.2% at 16,056.53, and the Cboe Small Companies was up 0.3% at 14,724.88.
"It was a pleasant surprise to see UK stock markets moving higher for the second day in a row in early trading," AJ Bell's Russ Mould said. "When you consider that US markets fell by 3% to 4% last night on Wall Street and tariff uncertainty continues to dominate the headlines, one might have expected investors to be feeling gloomy. Yet we'll take all the good news we can get at the moment.
"Admittedly, the UK market struggled to hold onto early gains, but at least there wasn't a sharp slump to start the day with a headache. UK GDP figures coming in much stronger than expected will have helped to lift the market mood.
"It gives hope that the country is more resilient than some might think. Unfortunately, there is a feeling that this might be as good as it gets for a while."
He continued: "There remains considerable uncertainty around the impact of tariffs on economies and company earnings, and that could keep markets volatile for some time. Investors shouldn't panic, however, as history shows that markets have a habit of going through bad patches and then recovering."
On the FTSE 100, BP was down 0.7%.
The London-based oil and gas major estimates that upstream production in the first quarter of 2025 was down from the fourth quarter of 2024.
It also noted that it expects net debt at the end of the first quarter to be around USD4 billion higher compared to the fourth quarter, "driven primarily by a working capital build, which is largely expected to reverse, reflecting seasonal inventory effects, timing of payments including annual bonus payments and payments related to low carbon assets held for sale".
It also noted that Brent prices have averaged USD75.73 per barrel during the first quarter, up 1.3% from USD74.73 per barrel in the prior quarter.
Brent oil was quoted higher at midday in London on Friday, at USD63.63 a barrel from USD63.32 late Thursday.
"While a preview of quarterly figures ordinarily wouldn't be assigned too much significance...such is the pressure BP and its management are under that they have little margin for error," Mould commented. "The teaser ahead of next month's full quarterly results also presses on one of the market's big sore points with the company – its onerous debt pile.
"While BP has pegged the increase in leverage on seasonal issues and expects to see this unwind in future quarters, there will still be nagging concerns about the uptick.
"With lower gas production also flagged, there is little to convince the company's activist shareholder Elliott that things are moving in the right direction...There is a growing sense that more radical steps will be needed to steer BP back on course."
On the FTSE 250, Foresight Group gained 2.0%.
The investment manager said it has appointed investment bank Joh Berenberg, Gossler & Co to run its share buyback worth up to GBP50 million. It will begin the buyback on Friday and complete it over the next three years.
Among smaller caps, Character Group lost 6.2%.
The Surrey, England-based toys, games and giftware company has withdrawn its market guidance for financial 2025 due to the uncertainty caused by US tariffs, which it said has "considerably obscured" its ability to forecast US sales and assess the full financial impact.
The US market accounted for around 20% of Character's revenue in its last financial year.
Outside the indices, Shein has a green light from the UK Financial Conduct Authority for a planned initial public offering in London, Reuters reported.
Citing two sources familiar with the process, Reuters reported that the FCA has approved Shein's UK IPO. Reuters also reported that the fast fashion company needs approval from Chinese watchdogs for the London Stock Exchange listing.
Mould commented: "London is crying out for new listings of scale and Shein getting its IPO off the ground and shares listed could help raise the profile of the UK market and potentially draw in more big names...However, the current market environment could render it moot and makes the targeted timetable of the first half of this year a big ask.
"Getting its IPO away at all could prove as tricky thanks to the levels of global market volatility unleashed by the US administration's trade policies...Shein does business in the US and could well see a significant impact from tariffs beyond just a hit to sentiment.
"It suggests Shein will have to stress to prospective investors that its growth is not reliant on the US and that expansion across a wide range of countries is key to its future."
Meanwhile, Heathrow airport reported a 7.5% decline in the number of passengers passing through its four terminals in March, to 6.2 million travellers from 6.7 million in March 2024.
Heathrow attributed the decline to the timing of Ramadan and Easter this year and to a 10-hour closure caused by a power supply failure on March 21.
In European equities on Friday, the CAC 40 in Paris was down 0.2%, while the DAX 40 in Frankfurt was down 0.9%.
Top EU officials and Chinese leaders are due to hold their next summit marking 50 years of ties in China in July, a spokesperson for the European Council said.
The EU had announced plans for a summit in January, before US President Donald Trump took office and unleashed swingeing tariffs.
"We are coordinating with China to set a date for the meeting, which is expected to take place in China in the second half of July," said the official at the council, the body representing the EU's 27 countries.
The bloc faces a delicate balancing act, seeking to negotiate with an unpredictable ally in Washington to avoid tariffs and the need to diversify trading partners, with its bid to hold the line on its own trade concerns regarding China.
The pound was quoted higher at USD1.3072 at midday on Friday in London, compared to USD1.2965 at the equities close on Thursday. The euro stood higher at USD1.1347 against USD1.1195. Against the yen, the dollar was trading lower at JPY143.03 compared to JPY144.41.
Stocks in New York were called higher. The Dow Jones Industrial Average was called up 0.7%, the S&P 500 index up 0.9%, and the Nasdaq Composite up 1.0%.
Iran is seeking a "real and fair" agreement with the US on its nuclear programme, a senior aide to Supreme Leader Ayatollah Ali Khamenei said, setting the stage for a diplomatic showdown this weekend in Oman.
Longtime adversaries Iran and the US are set to hold talks on Saturday in Muscat, aimed at reaching a potential nuclear deal. US President Donald Trump last month sent a letter to Khamenei urging negotiations and warning of possible military action if Tehran refuses.
Gold was quoted higher at USD3,224.53 an ounce against USD3,069.25.
Still to come on Friday's economic calendar, the US has producer inflation data and the Michigan consumer sentiment index.
By Emma Curzon, Alliance News reporter
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