FTSE 100 today: U.K. inflation rises above expected, index falls; GBP climbs
- FTSE 100 falls 45 points to 8,589
- Convenience food makers Greencore and Bakkavor agree merger
- Raspberry Pi (LON:RPI) posts first final results in line with expectations
- Government proposes ’streamlining’ of environmental regulations for builders
4.15pm: FTSE 100 trims losses and FTSE 250 back to flat
The FTSE 100’s deficit has been trimmed to less than 42 points, while the FTSE 250 is now back to flat, almost, with just a few minutes to go before the closing bell in London.
US stocks are in positive territory now too, with the S&P 500 and Dow both up 0.3% and the Nasdaq up 0.4%.
And Donald Trump’s press secretary Karoline Leavitt is also doing her vocal warm-ups, no doubt, with a preview of the announcement expected in 15 minutes too.
Among the blue-chips the biggest fallers are aerospace players Rolls-Royce (LON:RR) and Melrose Industries (LON:MRON), followed by drugmaker GSK (LON:GSK) and housebuilders Persimmon (LON:PSN) and Taylor Wimpey (LON:TW).
JD Sports Fashion (LON:JD) is top of the leaderboard, up 2.4%, with WPP (LON:WPP), M&S and IAG (LON:ICAG) next in line.
Bunzl (LON:BNZL) is also there after Stifel upgraded the stock to ‘buy’ from ‘hold’, citing a relatively Trump-proof business model.
On the mid-cap index, WAG Payment Solutions (LON:WPS) - aka Eurowag - is up 16% to lead the renaissance, having reported results last week and been steadily climbing all day. Can’t see anything specific - maybe a broker note will emerge tomorrow.
Bakkavor Group is next, after agreeing a price to be taken over by rival Greencore.
3.32pm: US markets are pricing more tariff impact than Europe
Tariff escalation has not yet been fully priced in by markets, says UBS strategist Gerry Fowler.
A full-blown tariff regime from the US, including 60% on most Chinese goods and 10% on the rest, would shave 0.5% off global GDP, with inflation impacts skewed heavily toward the US.
That estimate is fuzzy, Fowler admits, though the message is clear: tariffs aren’t just a trade policy - they’re a global macroeconomic headwind.
"Since tariff rhetoric began to escalate in January, markets have moved to price an increasing probability of implementation and impact," he says in a note, pointing to US 10-year Treasury bond real yields down 30-50 basis points and 2yr inflation expectations up 70 basis points – both reflecting "perhaps half or more" of the forecast impact.
In equity markets, tariff-sensitive stocks have underperformed broader markets by 17% in the US but only 9% in Europe, he notes, with US analysts downgrading sales and earnings growth broadly, but more so in tariff-sensitive sectors like Consumer Durables, Autos, and Retail.
"In Europe, analyst expectations have been resilient and there is not yet a downgrade trend for tariff-sensitive sectors like Autos, Luxury, or Pharma."
2.56pm: US stocks open lower, Tesla deliveries disappoint
US stocks have opened lower but already have trimmed their losses, though Tesla is down 4% after its first-quarter deliveries number disappointed.
The Dow Jones has fallen 0.5% and the S&P 500 0.45%, while the Nasdaq has slipped down 0.4% and the Russell 2000 dropped 0.5%.
Back in London, the FTSE 100 is off its worst levels of the day, down 0.6%, while the FTSE 250 is sitting 0.5% lower.
2.15pm: Motor finance could get more complicated, says broker
The push-back by the Financial Conduct Authority pushed back against the motor finance compensation ruling may limit payouts but complicate the compensation process, according to RBC Capital.
Yesterday, the FCA told the Supreme Court that it felt the Court of Appeal had gone "too far" by assuming all car dealers owed customers a fiduciary duty - meaning a legal obligation to act in their best interest.
Instead, the regulator argued that each case should be judged on its own facts, so that lenders that clearly disclosed the possibility of commissions in their terms and conditions may not be liable.
RBC analysts believe this case-by-case approach complicates the creation of a blanket compensation scheme expected later this year.
But it said that for lender such as Close Brothers (F:CBRO) and Lloyds (LON:LLOY) the size and scale of potential liabilities remain significant, particularly if the final court ruling aligns with the earlier appeal judgment.
1.32pm: Schedule for Trump tariff annoucement
Shares in London and Europe have dropped as the schedule for Donald Trump’s liberation day’ has been shared on social media.
At 9am ET (2pm UK), President Trump will convene with his trade council to finalise the "transformative tariff initiative".
Then, at 11:30am ET, just as trading closes in London and Europe, White House press secretary Karoline Leavitt will preview the announcement.
At 4pm ET (9pm BST), in the Rose Garden, President Trump will unveil the "bold reciprocal tariffs, restoring fairness to US trade".
Shortly after, the President will hold a pres conference and in the evening administration officials will brief US industry leaders on how the tariff plans are to be implemented.
The final line is a doozy "8:00 PM ET: Global markets respond as the impact of America’s renewed strength takes hold."
12.39pm: Response to Defra report
In response to Defra’s announcement on reforms to environmental regulation, Catherine Spitzer, CEO of Environment Bank, has come to the defence of biodiversity net gain rules.
"It is sensible for Defra to review existing measures on environment regulation, however, the government should be aware that BNG has been a clear success story," she says.
Recommendation 9 of the Corry report is to "review the funding streams connected to place-based delivery", such as BNG, "to ensure they can be used as flexibly as possible", while Recommednation 24 is that Defra "needs to quickly evaluate and improve" current schemes including BNG and nutrients credits "to make any early adjustments needed to maximise their delivery".
Corry said the schemes "should be streamlined and simplified, with consideration given to whether there are different ways to aggregate BNG credits to help local authorities, farmers and landowners deliver wider environmental improvements".
BNGs have been in effect in England for just over a year, which she said has led to almost 2,500 acres of land being secured for habitat creation and generating over biodiversity units that are paid for by developers.
"BNG is working for developers, landowners and local authorities and is already serving as a global blueprint for coherent and effective nature compliance policy in action," she said.
12.10pm: Starmer ’calm’ but ’will rule nothing out’ on US tariffs response
In his latest comment in Westminster, PM Keir Starmer is promising a "calm, pragmatic approach" in the face of US tariffs that will be announced later.
He vows to work with all industries and sectors impacted.
The UK government is preparing for "all eventualities" on US tariffs. "We will rule nothing out," he says in the House of Commons.
President Trump’s reciprocal tariffs are set to be unveiled in a speech tonight at 9pm UK time.
"That means another nervy session as investors and traders struggle to position themselves ahead of the event," says market analyst David Morrison at Trade Nation.
"The trouble is that there’s such opacity in advance of tonight’s announcement. It’s therefore unsurprising that most traders are sitting on their hands, or taking mitigating action such as hedging and trimming their exposure to risk assets."
He notes that both the S&P 500 and Nasdaq have spent the past month and a half retreating from their mid-February all-time highs, having lost 4.7% and 10.4% respectively since then.
"It could be that this week’s reaction to Trump’s announcement tonight, along with promises of retaliation, is key to unlocking this conundrum. We shall see."
???? LIBERATION DAY CHEAT SHEET ???? pic.twitter.com/B88Cy7r63y— Newsquawk (@Newsquawk) April 2, 2025
11.57am: Call for no job cuts at Bakkavor
The takeover of Bakkavor Group PLC (LSE:BAKK) by Greencore Group PLC (LSE:LON:GNC) must not result in job losses or factory closures, trade union GMB Union has warned.
As the pair announced that a £1.2 billion takeover has been agreed, there was mention of "expected synergies", which GMB notes is often management speak for cost-cutting.
Eamon O’Hearn, GMB National Officer, said: "This is a massive merger and could possibly pique the curiosity of the Competition & Market Authority’s new boss.
"Whether it does or now, companies ‘assessing synergies’ is often management speak for cost cutting. It is widely acknowledged by government and the wider industry, that the UK food and drink industry needs more capacity not less.
"GMB is calling for a commitment to no factory closures and no job losses."
The CMA, even if its curiosity is piqued, is unlikely to block the deal given its new growth mandate from Labour.
11.38am: Rathbones unappreciated
Rathbones Group PLC (LSE:RAT, OTC:RTBBF) was up earlier but is now flat, after RBC Capital Markets upgraded its rating to ‘outperform’ from ‘sector perform’.
The analysts see a "compelling value opportunity" as the full integration of Investec (LON:INVP) Wealth nears, which will make the group "a full-service wealth manager operating at scale".
New management arriving offers "an opportunity for further strategic progression, to ensure the enlarged franchise achieves its organic growth potential," the RBC team said, lifting their price target to 2,000p from 1,850p and noting that Rathbones shares are trading at a material discount to peers despite stronger near-term growth.
11.18am: Losses deepen
The FTSE 100 is really stumbling now, down 0.8%.
Three of the index’s top stocks are down more than 2% -- AstraZeneca (LON:AZN), GSK and Rolls-Royce, while only five of the top 20 largest names are not in the red.
Several housebuilders are also down over 2%.
Over the Channel, losses are also deeper, with the DAX for one now down 1.2%, and US futures have also dropped further.
11.01am: AI funds in the red over the past year
AI-focused investment funds have failed to outperform other technology sectors, and are now averaging losses of 3.3% over the past year, according to new research.
"Following a period of intense investor excitement over AI, the sector took a sharp blow in January following the release by DeepSeek of its AI powered chatbot," said Bowmore Asset Management, which carried out the analysis.
"The launch of DeepSeek’s chatbot crystalised concerns over soaring valuations in the sector and saw a sharp sell-off in shares in companies such as Nvidia (NASDAQ:NVDA)."
The underperformance of AI funds also reflects that a number of these funds also have weightings in robotics companies, such as Japanese automation firms Yaskawa and Keyence (TYO:6861), whose shares have performed poorly over the past year.
Jonathan Webster-Smith, chief investment officer at Bowmore, says: "AI remains a hugely exciting sector but it pays not to be too overweight in a sector and certainly not a sector where it becomes hard to justify valuations.
"The poor performance of some AI funds, due to their exposure to robotics companies, also shows why investors need to look ‘under the bonnet’ before committing their money to a fund."
He adds: "There are still plenty of exciting opportunities in technology but the risk appetite of most investors means they may be better taking a more generalist approach to tech, rather than being too concentrated in one or two shares or even one subsector of tech."
10.56am: UK could sign US trade concession ’in days or weeks’
There are no plans for Prime Minister Keir Starmer to speak to President Trump today ahead of the tariffs announcement, but a deal could be signed as soon as next week, the Times is reporting.
No last-ditch concession from Trump is expected ahead of his tariffs announcement today.
"Keir Starmer is not planning to speak to him today, but there are hopes that the economic deal giving Britain a carve-out can be signed as soon as next week," the newspaper says, noting that sources mention it could be a matter of "days or weeks".
"But in truth No 10 doesn’t know what Trump is planning or when concessions could be made," the report continues. "All deeply uncertain this morning."
10.31am: New building regulations
The government has announced "major reforms" for the housing regulations on the environment that it says are to both "boost growth and protect nature".
Defra (the Department for Environment, Food & Rural Affairs) says the reforms will "streamline and modernise" regulation to help deliver 1.5 million homes.
Housebuilding sector shares are in the red this morning, though.
A review commissioned by Environment Secretary Steve Reed, led by economist Dan Corry, concludes that a "bonfire" of the current patchwork of over 3,500 regulations is not the solution but makes 29 recommendations for streamlining regulation.
Defra says it is "actively considering" all these proposals, with Reed saying he is "rewiring Defra and its arms-length bodies to boost economic growth and unleash an era of building while also supporting nature to recover".
He says Corry’s report "gives us a strong set of common-sense recommendations for better regulation that will get Britain building".
FTSE 100 builders Persimmon and Taylor Wimpey were down 3.4% and 3.1%, while peers Berkeley (LON:BKGH) Group and Barratt Redrow (LON:RDW) were down 2.5% and 2.1%.
10.14am: Revolut wants to become a market market
Revolut wants to become the "world’s leading market maker", according to a story on the FinancialNews website.
The London-based fintech is aiming to take a chunk of business from big investment banks and Winterfloods in London, with the report noting that it has advertised for an algorithmic trader and senior quantitative researcher to join the fledgling division.
"Never going to happen," one Wall Street source says.
10.09am: Raspberry Pi upgraded
Raspberry Pi Holdings PLC (LSE:RPI) shares are being helped by some positive broker reaction, including an upgrade from Jefferies.
Analysts at the US firm said the inventory correction that was a headwind for 2024 revenues and earnings, "has now largely ended".
"As a result orders are showing a gradual improvement," and new products and a direct-to-OEM customer strategy is expected to further accelerate into 2026, Jefferies said, upgrading the stock from ’hold’ to ’buy’.
John Moore, senior investment manager at RBC Brewin Dolphin, also said the results showing a 2% fall in revenue and 57% decline in profit "don’t make for great reading," but need to be put in context of the inventory issues that were an industry-wide challenge for much of the reporting period.
He concludes: "Longer term, even though it may not be a familiar name to many people at the moment, Raspberry Pi has the potential to be the UK tech success story many market commentators have been looking for."
The shares are up over 8% now.
9.43am: Grafton buys HSS Ireland
Shares in HSS Hire Group PLC (AIM:HSS) are up 9% after the company agreed to sell its Irish business to FTSE 250-listed Grafton Group PLC (ISE:GFTU) for just over £26 million.
HSS Hire Ireland, which specialises in tool and equipment rental across the Republic of Ireland, will change hands at a multiple of around 6.9 times its 2024 earnings, subject to regulatory clearance.
Elsewhere, Shearwater Group is up 8% after the cybersecurity firm announced an £8.4 million contract extension with a major telecoms and media company.
The deal extends an existing three-year agreement by a further two years.
9.05am: European markets generally down as tariffs eyed
Stock markets around Europe are almost all back in the red today, with the FTSE’s 0.4% decline joined by a 1.1% tumble for the DAX in Frankfurt and a 0.6% slide for the CAC 40 in Paris.
The FTSE MIB is down 0.7% in Milan, but Madrid’s IBEX 35 stands alone, up 0.1% thanks to a 13% jump for pharma giant Grifols (BME:GRLS) on reports that Canadian investment fund Brookfield has resumed talks on a potential takeover.
"European markets and US futures are trading in the red, reflecting a mix of tariff concerns, geopolitical tensions and economic data that are contributing to a cautious mood among global traders," sums up market analyst Naeem Aslam at Zaye Capital Markets.
Susannah Streeter at Hargreaves Lansdown (LON:HRGV) says: "Investors are on tenterhooks as the clock ticks down what’s expected to be the biggest wave of tariffs on US trading partners."
Today’s falls are part of what she calls a pattern of "one step forward, two steps back...as hopes for more leniency in trade policy keep being dashed, and the Trump administration seems intent on playing hardball".
US reciprocal tariffs day "has finally arrived", says Marc Ostwald at ADM Investor Services, who notes that there is "an otherwise light schedule of both data and events unlikely to make much of an impression on rather febrile and tense markets".
Jim Reid at Deutsche Bank (ETR:DBKGn) notes that the WSJ reported last night that other options under consideration by Donald Trump include a more targeted reciprocal plan as well as an across-the-board tariff on a subset of nations.
Bloomberg reported that a tiered tariff system option could see countries face levies of either 10% or 20% depending on their barriers on US goods.
US Treasury Secretary Scott Bessent yesterday said that the tariffs announced today would be a cap and that countries would be able to bring them down.
How other countries react and retaliate will also be key, with EU Commission president Ursula von der Leyen saying yesterday that "if necessary, we have a strong plan to retaliate and will use it", while Canadian prime minister Mark Carney said "we will not disadvantage Canadian producers and Canadian workers relative to American workers".
Reid adds: "And President Trump has already said that any retaliation could be met by further US tariffs, so a key downside risk from here is that this kicks off an escalatory spiral of higher tariffs."
8.40am: Topps slips, Bright Peer jumps off
Among small caps, Topps Tiles PLC (LSE:LON:TPT) shares fell 6% after the retailer published a trading update revealing January started slowly, but volumes built through February and March, with profit margins also on the bounce.
Overall, group sales increased 4.0% to £127.7 million for its half-year to 29 March 2025, with underlying sales growth of 4.4% in the second quarter.
Analyst John Stevenson at Peel Hunt (LON:PEEL) says: "Our sense is that this growth is more attributable to market share gains rather than consumer recovery."
Elsewhere, shares in Brighton Pier Group PLC (AIM:LON:PIER) plunged 50% in early trading after the company revealed plans to delist from London’s AIM market and go private, citing rising costs, a tough trading environment and limited investor interest.
The leisure group, best known for its iconic Brighton seafront attraction, said staying listed no longer made financial sense.
8.26am: Chemring (LON:CHG) wins MoD missile contract
Chemring Group (LSE:CHG) shares are one of the top risers on the FTSE 250, up 3%, after its Roke division won a "strategically important" £251 million contract with the UK Ministry of Defence to provide missile defence.
The framework contract, known as STORM, will see a wide spectrum of missile defence activities and capabilities provided, with Roke the overall prime contractor.
It will coordinate with other companies to "lead a UK sovereign industry collaborative effort to provide security to the UK and its allies, by countering current and future threats, including ballistic and hypersonic missiles", the company said.
8.11am: FTSE 100 off on the wrong foot
The FTSE 100 has started Wednesday off on the wrong foot, sliding 23 points to 8,611.3.
GSK and AstraZeneca were among the big falles, echoing a decline in US big pharma names overnight.
Housebuilders were also lower, led by Persimmon, Barratt and Taylor Wimpey.
On the FTSE 250, Raspberry Pi shares are up 3%, while Bakkavor has jumped 5.7%.
7.53am: Raspberry Pi’s first results
Raspberry Pi Holdings PLC (LSE:RPI) has reported its first full-year results following its IPO last June, with a 2% fall in revenue and 57% decline in profits as the second half of last year saw it launch more new products in any year before.
The results were broadly in line with expectations.
The UK tech company said: "With channel inventory now normalised, Raspberry Pi anticipates a steady build-up in demand throughout the year, positioning us strongly despite ongoing macroeconomic and geopolitical uncertainties."
CEO Eben Upton added that the IPO "has undoubtedly extended awareness of Raspberry Pi’s value proposition from the engineering department to the C-suite at major OEMs", and he is confident that there will be "gradual improvements in end-demand during the current year and increased traction with direct-to-OEM engagement, effectively complementing our reseller and licensee channels".
7.28am: UK food producers merge
FTSE 250 pair Greencore Group PLC (LSE:GNC) and Bakkavor Group PLC (LSE:BAKK) have agreed a merger to create a £4 billion convenience food group.
The two companies, which make products for all the major supermarkets, said they had struck a deal structured as a possible offer by Greencore for Bakkavor, where shareholders in the latter would receive 85p in cash and 0.604 Greencore shares per share, as well as retaining the right to a final dividend of 4.8p.
This creates an implied value per Bakkavor share of 200p, excluding the final dividend, representing a 32.5% premium to the share price on 13 March and values Bakkavor at approximately £1.2 billion.
Following the deal, Greencore shareholders would hold around 56% of the combined group, and Bakkavor’s 44%.
7.14am: FTSE 100 forecast to fall
The FTSE 100 is forecast to fall back on Wednesday ahead of Donald Trump’s reciprocal tariffs announcement later, following a mixed session on Wall Street overnight and in Asian markets this morning.
A decline of 24 points has been suggested for London’s blue-chip benchmark on the futures market, to knock off much of the 52 points gained yesterday that left the index closing at 8,634.8.
Last night, the Dow Jones closed flat, while the S&P 500 and Nasdaq rose 0.2% and 0.5% respectively, thanks to gains from the ’Magnificent 7’ tech giants.
In Asia, Japan’s Nikkei is flat and Hong Kong’s Hang Seng is down 0.2% but India’s Sensex is up 0.5%.
5am: What to watch on Wednesday
Wednesday is when US President Donald Trump will announce what reciprocal tariffs come into force the following day, what he has been calling "liberation day".
Markets are braced for the imposition of proposed blanket levies, which include 10% on all imports and up to 60% on Chinese goods, with investors keeping an eye out for retaliatory signals from trade partners or potential deals done to skirt the measures...read more
In London company news, energy utility SSE PLC (LSE:LON:SSE) will publish numbers as its shares trade at their lowest in over two years. Analysts at JP Morgan said recently that this seemed over-harsh, though might simply be a reflection of rising bond yields rather than the performance of the business...read more
Elsewhere, newcomer Raspberry Pi Holdings PLC (LSE:RPI) will be posting its first full-year results as a listed company, though analysts warned that the year ahead is likely to be one of transition...read more
Announcements due on 2 April:
Interims: Gattaca PLC
Finals: Argentex (LON:AGFX) Group Plc, Big Technologies (LON:BIGB) Plc, Distribution Finance Capital Holdings Plc, Norman Broadbent (LON:NBB) Plc, Raspberry Pi Holdings Plc
US earnings: Levi Strauss (NYSE:LEVI), Blackberry (TSX:BB)
Economic announcements: MBA Mortgage Applications (US), Factory Orders (US)