London close: Stocks rise on hopes of UK-US trade deal
By Josh White
Date: Tuesday 15 Apr 2025
(Sharecast News) - London stocks finished higher on Tuesday, lifted by renewed optimism over trade prospects and a measured response to UK labour market data.
The FTSE 100 index rose 1.41% to close at 8,249.12 points, while the FTSE 250 gained 1.53% to end the session at 19,267.94 points.
In currency markets, sterling was last up 0.29% on the dollar to trade at $1.3228, as it gained 0.77% against the euro, changing hands at €1.1709.
Investor sentiment improved after US vice president JD Vance offered encouraging remarks on the possibility of a UK-US trade agreement.
Further support came from president Donald Trump, who indicated he could consider temporary exemptions to tariffs on vehicles and auto parts, easing concerns over potential trade barriers.
"European stock indices continued to grind higher as optimism grew over a potential pause in automobile tariffs and as eurozone industrial production growth beat forecasts," said IG senior technical analyst Axel Rudolph.
"The steepest drop in expectations in Germany's economic sentiment indicator since the onset of Russia's invasion of Ukraine pared these gains, though."
Rudolph noted that US stock indices traded slightly higher as import prices unexpectedly fell amid unpredictable shifts in US trade policy, which weighed on sentiment and consumption.
"The dollar remains under pressure close to last week's three-year low with crude oil, gold and silver prices little changed ahead of Wednesday's Fed chair Jerome Powell speech."
UK jobless rate remains steady as retail sales rise
In economic news, the UK unemployment rate remained steady at 4.4% in the three months to February, according to the Office for National Statistics.
Wage growth remained robust but showed signs of softening, with average weekly earnings excluding bonuses rising 5.9% year-on-year, slightly below expectations.
Including bonuses, earnings rose 5.6%, matching forecasts.
The figures suggested continued pressure on the Bank of England as it balances inflation concerns with a cooling labour market.
"Overall, while wage growth remains too high, the growing downside risks to inflation and activity from higher US tariffs may mean the Bank of England starts to become less worried about the upside risks to inflation from pay growth and more worried about the downside risks to activity," said Ashley Webb, UK economist at Capital Economics.
"The risk is that interest rates are cut a bit faster than the fall from 4.50% now to 4.00% this year that we expect."
Retail data meanwhile provided cautious optimism, as the British Retail Consortium reported that UK retail sales rose 1.1% in March compared with a year earlier, supported by Easter timing and improved weather.
While below the recent three-month trend, it marked a modest improvement on the 12-month average.
Food sales were up 1.6%, while non-food sales increased 0.6%, helped by gains in online shopping and seasonal demand for gardening and DIY products.
Linda Ellett, UK head of consumer, retail and leisure at KPMG, said the year-on-year growth "feels an achievement" amid downbeat consumer confidence and rising household costs.
"But with non-food sales only climbing around 1% on average, competition means there are some retailers really struggling whilst others win, especially online.
"Retailers will be pushing for higher growth rates as we move toward summer and holiday season, particularly as they are now paying higher wage costs and facing volatility and potential impact on their supply chains due to global tariffs."
On the continent, industrial production in the eurozone climbed 1.1% in February from the prior month, outperforming January's slower growth.
Annual output also rose, driven by a surge in non-durable consumer goods.
Ireland led gains with a double-digit monthly increase, though not all sectors or countries shared in the momentum.
Some components, including capital goods and intermediate goods, remained below year-ago levels, highlighting uneven recovery.
However, investor confidence in Germany deteriorated sharply, as the ZEW economic sentiment index plunged to -14 in April from 51.6 in March - its steepest drop since early 2022.
Analysts cited growing unease over shifting US trade policies, particularly recent moves by the Trump administration to introduce and then reconsider broad tariffs.
The uncertainty weighed heavily on outlooks for export-reliant industries.
Oil prices meanwhile fell after the International Energy Agency downgraded its forecast for global oil demand growth, citing weak industrial activity and heightened trade tensions.
The IEA now expected demand to rise by just 730,000 barrels per day in 2025, one of the slowest growth rates in recent years.
Surging OPEC+ output and rising inventories further pressured prices, as the agency warned that weak compliance and overproduction could undermine planned output increases.
Elsewhere, tensions between China and the United States escalated, with Beijing ordering domestic airlines to suspend deliveries of Boeing aircraft and halt purchases of US aviation parts.
The move followed the imposition of steep retaliatory tariffs on US goods, bringing total levies to 145%.
3i Group jumps on broker upgrade, luxury brands suffer after LVMH results
On London's equity markets, 3i Group jumped 6.15% after Citi raised its price target on the stock to 4,850p from 4,670p, citing currency effects and reaffirming a 'buy' rating.
The move followed the release of 2024 results from Dutch discount retailer Action, in which 3i holds a stake.
Tate & Lyle climbed 6.16% after confirming its fourth-quarter performance met expectations and that it remained on track to deliver results in line with its 2025 guidance.
B&M European Value Retail also rose strongly, up 4.71%, after forecasting adjusted operating profits above the mid-point of its guidance range, citing stronger sales and productivity gains.
Passenger transport operator FirstGroup gained 2.95% after stating that adjusted operating profit and earnings per share for the year ahead were now expected to exceed previous estimates, helped by a stronger performance in its rail division.
Frasers Group added 1.62% after announcing a new agreement with Australia's Accent Group to expand Sports Direct into the Australian and New Zealand markets.
Components specialist DiscoverIE Group rose 5.05% and sector peer Rotork added 1.96%, with both stocks upgraded to 'outperform' by RBC Capital Markets.
The broker said DiscoverIE's valuation already accounted for tariff risks, while Rotork was trading near the bottom of its 10-year range.
Next and JD Sports Fashion rose 2.13% and 2.04% respectively, lifted by broker upgrades at Goldman Sachs and Barclays.
Domino's Pizza Group also edged higher, gaining 1.46% despite a downgrade from Barclays.
On the downside, Burberry fell 4.46% after LVMH's first-quarter sales came in below expectations, prompting concerns about broader demand in the luxury sector.
Watches of Switzerland slipped 1.77% in a similar reaction.
Distilling giant Diageo dropped 2.8% as LVMH reported an 8% decline in wines and spirits sales, raising concerns about trends in the premium beverage segment.
Reporting by Josh White for Sharecast.com.
Market Movers
FTSE 100 (UKX) 8,249.12 1.41%
FTSE 250 (MCX) 19,267.94 1.53%
techMARK (TASX) 4,429.99 1.01%
FTSE 100 - Risers
3i Group (III) 4,130.00p 5.79%
St James's Place (STJ) 902.20p 4.21%
Intermediate Capital Group (ICG) 1,816.00p 3.77%
SEGRO (SGRO) 669.80p 3.75%
Fresnillo (FRES) 1,058.00p 3.73%
Standard Chartered (STAN) 1,025.00p 3.60%
M&G (MNG) 194.80p 3.53%
Unite Group (UTG) 863.50p 3.41%
Kingfisher (KGF) 266.80p 3.41%
Barclays (BARC) 279.20p 3.25%
FTSE 100 - Fallers
Diageo (DGE) 2,046.00p -3.46%
Glencore (GLEN) 255.95p -1.58%
Pershing Square Holdings Ltd NPV (PSH) 3,352.00p -1.12%
Flutter Entertainment (DI) (FLTR) 17,470.00p -0.94%
Rentokil Initial (RTO) 334.60p -0.54%
CRH (CDI) (CRH) 6,540.00p -0.40%
AstraZeneca (AZN) 10,280.00p -0.39%
Croda International (CRDA) 2,664.00p -0.19%
Haleon (HLN) 378.50p -0.13%
Unilever (ULVR) 4,687.00p -0.11%
FTSE 250 - Risers
PPHE Hotel Group Ltd (PPH) 1,320.00p 7.15%
Tate & Lyle (TATE) 534.50p 6.16%
Bridgepoint Group (Reg S) (BPT) 266.80p 5.96%
NCC Group (NCC) 136.80p 5.07%
Discoverie Group (DSCV) 541.00p 5.05%
B&M European Value Retail S.A. (DI) (BME) 313.30p 4.71%
Crest Nicholson Holdings (CRST) 163.80p 4.26%
Rathbones Group (RAT) 1,534.00p 4.21%
Trustpilot Group (TRST) 214.60p 4.17%
Big Yellow Group (BYG) 942.00p 4.09%
FTSE 250 - Fallers
Burberry Group (BRBY) 655.20p -4.55%
Dr. Martens (DOCS) 51.25p -1.81%
Watches of Switzerland Group (WOSG) 356.00p -1.77%
Oxford Instruments (OXIG) 1,638.00p -1.69%
Indivior (INDV) 695.00p -1.42%
Auction Technology Group (ATG) 618.00p -1.12%
Sequoia Economic Infrastructure Income Fund Limited (SEQI) 75.90p -1.05%
SSP Group (SSPG) 142.50p -1.04%
BH Macro Ltd. GBP Shares (BHMG) 400.00p -0.99%
Raspberry PI Holdings (RPI) 441.60p -0.98%
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