Tariffs reside: FTSE recovers and gold hits document excessive after Trump admits issues over ‘costs’
The FTSE 100 has opened 0.76 per cent higher in early trading on Friday, easing any worries that the London Stock Exchange would follow last night’s S&P 500 into the red.
In Europe, both the CAC 40 in Paris and the DAX in Frankfurt are up too, around 0.6 per cent each, while Hong Kong’s Hang Seng is set to close shortly as remains up 1.5 per cent.
Gold prices have soared to record highs amid a sell-off on global stock markets after Donald Trump admitted the United States will face “transition cost and transition problems” as a result of his global tariff plan.
Experts say investors are rushing to “safe-haven” assets as Mr Trump again threatened to impose the full rate of his “reciprocal” levies if countries fail to strike a deal with him within 90 days.
He said: “We think we are in very good shape. We think we are doing very well. Again, there will be a transition cost and transition problems, but in the end, it’s going to be a beautiful thing.”
China hits back to increase tariffs on US goods to 125% up from 84%
China will impose 125% tariffs on U.S. goods from Saturday, up from the 84% previously announced, the finance ministry said on Friday.
German finance minister: EU is ready to respond if trade talks with U.S. unsuccessful
The European Union will be ready to respond to tariffs if negotiations with the United States do not work, German Finance Minister Joerg Kukies said on Friday.
“The US side has to be aware that if negotiations do not work, then we will have another discussion around response mechanisms,” Kukies said in Warsaw ahead of a meeting of EU finance ministers.
Kukies also warned that Donald Trump’s decision to pause trade tariffs for dozens of countries for 90 days may add to uncertainty and keep markets and company executives on edge.
“What remains is the uncertainty, which no CEO likes,” the outgoing finance minister said in an interview in German newspaper Handelsblatt’s Friday edition.
“It potentially increases uncertainty even more. After all, there could be further escalation after 90 days,” he added.
Nigel Farage compares Donald Trump to Liz Truss
Reform UK leader Nigel Farage has compared good friend Donald Trump’s trade war to Liz Truss’s disastrous 49-day stint as prime minister.
“Do you know what, I think Trump did too much too soon, rather like Liz Truss did a couple of years ago,” he told LBC.
“I’ve never in my life before seen stock markets fall quickly and bond markets fall at the same time.
“As for the slugging it out with China, who’s going to win? Right now? I just don’t know.”
European market shows green shoots of recovery after Trump pauses tariffs
In Europe, both the CAC 40 in Paris and the DAX in Frankfurt are up too, around 0.6 per cent each, while Hong Kong’s Hang Seng is set to close shortly as remains up 1.5 per cent.
The latter was hard-hit at the start of the tariff worries, mind, so remains down eight per cent across the week and 11 per cent over a month.
On the Euro STOXX 50 this morning, the biggest riser is Dutch chipmaker ASML, showing a 2.7per cent change to the green as we head toward the weekend.
Spain’s PM visits China to boost ties amid tariff chaos
Spain’s Prime Minister Pedro Sanchez is visiting China on Friday, as his government seeks to boost investment from the Asian giant amid global economic uncertainty caused by a chaotic US tariff policy.
Mr Sanchez met with Chinese President Xi Jinping and was also expected to meet with business leaders from several Chinese companies, many of which produce electric batteries or renewable energy technologies.
“A trade war favours no one. We all will lose,” Mr Sanchez said after meeting with Vietnamese leaders in Hanoi before his trip.
Spain’s government spokeswoman Pilar Alegria said earlier this week that Mr Sanchez’s trip “has special importance” and is an opportunity to “diversify markets” – Spain could see as much as 80% of its exports to the US impacted by Trump’s tariffs.
The FTSE 100 has started firmly in the green
The FTSE 100 has opened 0.76 per cent up in early trading, easing any worries that it would follow last night’s S&P 500 into the red.
The US-based sell-off served ass a reminder that all is not fixed in terms of the tariffs and global trade, but it’s a fairly calm picture on the London Stock Exchange today so far with just nine companies in negative territory.
Mining is a strong early sector with each of Glencore, Endeavour and Fresnillo showing gains of more than two per cent – the latter almost double that number – and financials are generally strong across the board too.
UK economy grew by 0.5% in February in boost to Rachel Reeves
February’s boost followed several months of almost flatlining, but came before Donald Trump sparked market volatility by placing – and then delaying – tariffs on nations around the globe.
China urges EU to join forces in opposing Trump’s ‘unilateral bullying’
Chinese president Xi Jinping on Friday urged the EU to join Beijing in opposing “unilateral bullying” from the US on trade, state media reported, referring to the steep tariffs imposed by US president Donald Trump.
Mr Xi made the appeal to Europe a day after Australia refused to “join hands” with China amid escalating global trade tensions.
French president calls out ‘fragile’ pause in tariffs
French president Emmanuel Macron has described Donald Trump’s suspension of tariffs as merely a “fragile pause”.
In a post on X, Mr Macron wrote: “The partial suspension of American tariffs for 90 days sends out a signal and leaves the door open for talks. But this pause is a fragile one. Fragile, because the 25% tariffs on steel, aluminum and automobiles and the 10% tariffs on all other products are still in place.”
He added: “This 90-day pause means 90 days of uncertainty for all our businesses, on both sides of the Atlantic and beyond.”
Mr Macron said France and the EU would “stay strong” and maintain a united front in negotiations aimed at getting the tariffs removed.
The real reason why Trump had no option but to back down on tariffs
Tariffgate might be on pause for now, but there’s still uncertainty ahead over whether it’s in 90 days’ time or sooner than that, given the incredible frequency with which he has changed tack so far.
Here are three reasons outside the stock market that Donald Trump ultimately had to backtrack – two of them which applied pressure – but the third, once again, was the real deciding factor at play.
Read the full piece here:
