(Reuters) – UK shares fell sharply on Friday and are poised to end the week with substantial losses, as recession fears intensified after China retaliated against U.S. President Donald Trump’s announcement of sweeping tariffs.
As of 1110 GMT, the blue-chip FTSE 100 index dropped 3.8% to its lowest level since December last year, on track for its steepest weekly decline since February 2022.
The domestically focused midcap index slid 4% and is set for its worst weekly drop since March 2020.
China, which is now facing a total of 54% tariffs on exports to the U.S., will impose additional 34% tariffs on all U.S. imports from April 10, its finance ministry said on Friday.
Britain faced the lowest import duty rate of 10% in Trump’s Wednesday’s tariff announcement, although officials acknowledged the country’s vulnerability to global economic headwinds.
Bank stocks fell for a second consecutive day as tariff concerns fuelled worries about growth in the world’s largest economy. Barclays led the sector’s losses on the blue-chip index with its 10% drop, followed by HSBC Holdings, Lloyds Banking Group and Standard Chartered.
The UK’s banking sector index tumbled 8% to a three-month low.
The index of mining companies dropped 6.3% as London copper posted its biggest weekly loss in nearly five months amid tariff concerns.
Bucking the trend, utilities — often traded as a bond proxy — gained more than 1%, reaching a six-month high.
Short-dated British government bond yields plunged in the aftermath of Trump’s tariffs, as traders increased bets on further Bank of England interest rate cuts.
BP Chair Helge Lund intends to step down “likely during 2026”, it said on Friday, amid a campaign by activist hedge fund Elliott for more change at the oil major. Its shares fell 4.9%.
Building materials supplier Travis Perkins rose 3% after brokerage Stifel upgraded the stock to “buy” from “hold”.
Separately, Britain’s construction industry shrank sharply last month, with civil engineering declining at the fastest rate since 2020 due to weak orders and a lack of new infrastructure work, according to a survey published on Friday that showed optimism plunged.
(Reporting by Ragini Mathur in Bengaluru; Editing by Shilpi Majumdar)
Comments