10th Feb 2025 08:56
(Alliance News) - European equities opened higher on Monday, shaking off tariff nerves, with BP a star performer on the eve of its annual earnings.
The FTSE 100 index traded up 32.66 points, 0.4%, at 8,733.19. The FTSE 250 was 109.67 points, 0.5%, at 20,917.51, and the AIM All-Share added 3.29 points, 0.5%, at 722.33.
The Cboe UK 100 was up 0.4% at 874.86, the Cboe UK 250 added 0.5% at 18,245.64, and the Cboe Small Companies was flat at 15,824.87.
The pound fell to USD1.2394 early Monday from USD1.2400 at the time of the London equities close on Friday. The euro slipped to USD1.0314 from USD1.0333. Against the yen, the dollar rose to JPY152.49 from JPY151.24.
Gold bought USD2,895.11 an ounce, rising from USD2,859.53. A barrel of Brent rose to USD75.02 from USD74.59.
"Another week starts with tariff threats. This time, everyone that applies tariffs to the US will be hit back with the same tariffs, and all aluminium and steel imports to the US – no matter from whom – will face a 25% tariff," Swissquote analyst Ipek Ozkardeskaya commented.
The EU said Monday it has "not received any official notification" of extra duties after US President Donald Trump warned he would impose 25% tariffs on steel and aluminium imports.
"We will not respond to broad announcements without details or written clarification. The EU sees no justification for the imposition of tariffs on its exports. We will react to protect the interests of European businesses, workers and consumers from unjustified measures," the European Commission said in a statement.
The EU will retaliate by replicating any tariffs imposed on it by the US, the French foreign minister said on Monday, warning Washington against a trade war.
"There is no hesitation when it comes to defending our interests," Jean-Noel Barrot said in an interview with TF1.
The UK will have to "wait and see" if Donald Trump provides more clarity on his threat to impose tariffs on all steel and aluminium imports to the US, a minister has said.
Asked on Monday morning about Trump's comments, Home Office minister Angela Eagle said the government will have to "wait and see whether the president gets more specific about what he meant by that comment".
She said: "We have a very balanced trading relationship with the US – I think GBP300 billion worth of trade between our countries – and I think it's in the best interests of both of us, as longstanding allies and neighbours, that we carry on with that balanced trade."
In Sydney, the S&P/ASX 200 lost 0.3%. In China, the Shanghai Composite was up 0.6%, while the Hang Seng Index in Hong Kong jumped 1.8%. Tokyo's Nikkei 225 edged up slightly.
Inflation picked up in China last month, official figures showed Sunday, as the Lunar New Year holiday boosted January spending.
China has struggled to raise consumption and stave off deflation for months as sluggish spending, a property slump and ballooning local government debt all weigh on growth.
The consumer price index, a key measure of inflation, rose 0.5% last month, accelerating from a 0.1% rise in December, according to the National Bureau of Statistics.
In London, BP shares advanced 7.0%. Elliott Investment Management has built a significant stake and called on the oil major to consider transformative measures, according to Bloomberg.
According to Bloomberg sources, the activist investor believes BP is significantly undervalued and its performance is disappointing.
The exact size of the stake taken by Elliott couldn't be immediately learned, Bloomberg added.
The company under former Chief Executive Officer Bernard Looney embraced net-zero in a failed bet that oil consumption had peaked, and has since struggled to present a clear strategy for a turnaround, the Bloomberg report noted.
Chief Executive Murray Auchincloss, who stepped into the role after Looney was dismissed over his personal conduct, is widely expected to outline a clearer shift back toward oil and gas when he presents a much-anticipated strategy update on February 26.
London-based BP reports full-year results on Tuesday.
IAG lost 2.0%. Goldman Sachs cut the British Airways parent to 'neutral' from 'buy'.
Fevertree lost 2.8% after Deutsche Bank cut the tonics maker to 'hold' from 'buy'.
Drax added 4.3%. It said it has agreed heads of terms with the UK government for the operation of Drax Power Station after 2027.
The Yorkshire, England-based power generator said the contract for difference scheme with a strike price of GBP113 per megawatt-hour applied to all four biomass units.
The company said the terms include a six terawatt-hour per year generation collar, with "flexible operation" to support high and low demand periods.
The contract period stretches from April 2027 to March 2031.
The CAC 40 in Paris added 0.2%, while the DAX 40 in Frankfurt rose 0.4%.
Viewers surveyed on Sunday thought that German Chancellor Olaf Scholz of the Social Democratic Party narrowly won the TV debate against his rival Friedrich Merz from the conservative Christian Democratic Union party.
In a survey conducted by the Forschungsgruppe Wahlen, 37% of viewers entitled to vote said that Scholz had done better than Merz, as reported by public broadcaster ZDF.
A total of 34% saw the CDU leader in the lead, and 29% saw no difference. The survey is not representative of all eligible voters in Germany, but only of the viewers of Sunday's duel.
Scholz and Merz faced off in their first televised debate on Sunday, just two weeks before the country heads to the polls in early elections on February 23.
By Eric Cunha, Alliance News news editor
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