FTSE 100 Joins European Rally Amid Trump Tariff Speculations

The UK's FTSE 100 rose slightly, echoing a European stock rally sparked by speculation about tariffs under Donald Trump's forthcoming presidency. Despite Trump denying reports of moderated tariffs, investor sentiment appeared positive. Downgrades impacted Rolls-Royce and Unilever. The FTSE 100 saw a 6% rise in 2024, bolstered by interest rate cuts.

The FTSE 100 edged higher on Monday, aligning with a broad European stock rally following a report suggesting that upcoming tariffs under Donald Trump's presidency might be less severe. Despite Trump denying these claims, optimism prevailed among investors.

Investor sentiment was further influenced by market heavyweight downgrades, with Unilever dropping 2.5% and Rolls-Royce falling 2.6%, following downgrades by RBC and Citigroup, respectively. Analysts view Trump's influence as significant for market movements as his presidency approaches.

Beyond the FTSE 100, the FTSE 250 midcap index showed a modest increase. Concerns persist regarding sluggish business activity and rapid employment cuts in December. Meanwhile, the anticipated U.S. nonfarm payrolls report could offer critical insights into future market directions.

(With inputs from agencies.)