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Highlights
US and China reportedly reach mutual understanding on trade and rare earths
White House signals July tariff deadline could be extended
London’s FTSE 100 set to open higher amid positive global sentiment
Stocks in London are poised for a positive start on Friday, following encouraging signals from Washington and Beijing over trade cooperation, particularly involving rare earth shipments to the United States.
A White House official indicated the US and China have developed a mutual understanding on how to implement the Geneva agreement. This statement followed US President Donald Trump’s remarks about having “just signed” a new trade agreement with China, although no additional details were disclosed.
In another development, Press Secretary Karoline Leavitt noted that the July 8 tariff suspension deadline may be extended, adding to optimism around the trade discussions.
According to IG, futures suggest the FTSE 100 will open higher by around fourteen points. On Thursday, the index ended the session slightly higher.
Meanwhile, the British pound was trading lower against the US dollar early Friday, as political developments around welfare reforms continued to unfold. The UK government confirmed that recipients of the Personal Independence Payment (PIP) would remain unaffected after reaching a compromise with Labour party members. In a letter to parliamentarians, Work & Pensions Secretary Liz Kendall outlined changes to universal credit aimed at protecting household incomes.
This announcement followed internal talks within the Labour party, with a significant number of MPs backing amendments to delay the bill. The second reading of the Universal Credit and Personal Independence Payment Bill is scheduled for Tuesday.
On the currency front, the euro dipped slightly against the dollar, while the greenback held steady against the Japanese yen.
Wall Street ended on a strong note overnight, with all major US indices posting gains. The Dow Jones, S&P 500, and Nasdaq Composite all moved higher amid ongoing optimism about global trade dynamics.
Yields on US Treasuries retreated modestly, with both the 10-year and 30-year notes easing from previous session highs.
Across Asia, the Nikkei 225 in Tokyo advanced firmly, while the Shanghai Composite and Hang Seng both traded lower. Australia's S&P/ASX 200 also finished in negative territory, influenced by broader regional sentiment.
In commodities, gold prices slipped slightly from the previous day, while Brent crude oil also traded lower in early morning deals.
On the corporate calendar, Various Eateries is scheduled to release its half-year financial results. Economically, focus turns to updated GDP data in the UK, followed by eurozone consumer confidence and inflation figures from France.
