12 Mar, 2025 08:27 12 Mar, 2025 08:26

London open: FTSE edges up as Trump tariff chaos continues; US CPI eyed

dl city of london canary wharf docklands underground tube london stock exchange lse finance trading generic photo — Sharecast image

London stocks rose in early trade on Wednesday following heavy losses in the previous session, but gains were muted as Trump’s tariff chaos rumbled on.

At 0820 GMT, the FTSE 100 was up 0.2% at 8,512.46.

Overnight, US President Trump’s 25% tariffs on steel and aluminium came into effect globally. The European Union responded by saying that it would impose counter tariffs on €26bn of US goods starting next month.

Meanwhile, Trump rowed back on his decision to double tariffs on Canadian steel and aluminium imports to 50%, just hours after making the announcement. This came after the province of Ontario suspended new charges of 25% on electricity that it sends to some northern states in the US.

US tariffs of 25% will still take effect from 12 March, however.

The UK has not followed with retaliatory tariffs but said it was reserving the right to retaliate, with the Business Secretary saying that "all options" are on the table.

Investors were also mulling news that Ukraine has agreed to a US-proposed 30-day ceasefire with Russia.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: ‘"As the ‘Trump bump’ has turned into a slump, investors are bracing for fresh volatility ahead. The impact of tariffs is front of mind, given broad 25% duties on imports of steel and aluminium have come into effect, with the risk of tit-for-tat retaliation high. China has already responded with higher duties on American goods and the EU is planning counter tariffs, which are expected to come into force in April. The disquiet evident among investors on Wall Street, spread to Asia, with the Nikkei flat and Chinese indices in the red.

"London’s FTSE 100 is set for a small rebound, buoyed by hopes for a ceasefire in Ukraine. The easing of geopolitical concerns will help improve sentiment to some extent, but investors will still be mulling the impact of tariffs on global growth and prospects for multinationals in an increasingly complex trading world. UK steel exporters are bracing for harsh winds to blow a storm through the industry, which has already been battered by higher energy costs, weaker demand, and over-supply on world markets."

Looking ahead to the rest of the day, all eyes will be on the latest US inflation reading, with the consumer price index for February due at 1230 GMT.

"Although the CPI headline rate is expected to moderate a little from 3% to 2.9% for February, prices pressures remain high," Streeter said.

In equity markets, Hill & Smith surged as the construction and infrastructure products firm hiked its annual dividend by 14% after seeing underlying profits rise by almost a fifth in 2024.

Hochschild Mining shone as the gold miner hailed its best financial performance for 13 years.

Infrastructure construction specialist Balfour Beatty edged up as it posted an 11% rise in underlying annual earnings and said it would buy back £125m in shares this year.

Financial services group Legal & General fell despite saying it will buy back £500m of shares this year after a strong financial performance in 2024, as part of plans to return more than £5bn to shareholders within three years - equal to around 40% of its market capitalisation.

Core operating profits were up 6% last year at £1.62bn, with a decline in asset management profits outweighed by growth in the retail and institutional retirement divisions.

4imprint tumbled as the direct marketer of promotional products posted a rise in full-year profits and revenues but struck a cautious note on the outlook.

Market Movers

FTSE 100 (UKX)8,512.460.19%
FTSE 250 (MCX)19,811.830.21%
techMARK (TASX)4,702.28-0.12%

FTSE 100 - Risers

CRH (CDI) (CRH)7,348.00p2.51%
Antofagasta (ANTO)1,779.00p1.69%
Smurfit Westrock (DI) (SWR)3,397.00p1.49%
Anglo American (AAL)2,277.00p1.43%
Barclays (BARC)287.55p1.41%
Fresnillo (FRES)865.50p1.35%
Melrose Industries (MRO)492.90p1.29%
Glencore (GLEN)317.35p1.18%
Entain (ENT)651.20p1.15%
Rolls-Royce Holdings (RR.)754.20p0.91%