FTSE 100 tumbles after Trump announces tariffs and hasn't ruled out UK goods tax

US President Donald Trump warned the European Union and the UK they would beryllium deed with tariffs unless they 'work it out'

London’s FTSE 100 Index tumbled much than 1% connected opening aft US President Donald Trump announced a question of tariffs and warned the European Union would beryllium next.

The bluish spot stock scale fell 105.8 points to 8568.2 – a autumn of 1.2% – soon aft the London marketplace began trading astatine 8am. Mr Trump said tariffs connected imports from Europe were coming and did not regularisation retired imposing tariffs connected UK goods, but reportedly said the concern with Britain “can beryllium worked out”.

European banal markets are bracing themselves for important losses pursuing important overnight declines successful Asia, triggered by Trump's announcement of a bid of tariffs, which has sparked concerns of a planetary commercialized war.

Although helium did not regularisation retired imposing tariffs connected UK goods, helium reportedly expressed optimism that the concern "can beryllium worked out". This improvement comes connected the heels of the imposition of tariffs connected Mexico, Canada, and China implicit the weekend, with these countries vowing to retaliate.

Asian markets, which were the archetypal to unfastened since the weekend's tariff announcements, person already felt the impact, with Japan's Nikkei plummeting 2.8% and the Hang Seng successful Hong Kong falling 1% lower. However, mainland Chinese markets volition stay closed until Wednesday owed to the Chinese Lunar New Year holiday.

The lb has edged little against a strengthened US dollar, down 1% astatine conscionable nether 1.23 US dollars, but has risen 0.4% to 1.20 euros arsenic the azygous currency comes nether pressure.

Kathleen Brooks, probe manager astatine XTB, cautioned that banal markets "are apt to person a beardown reaction" to Mr Trump's archetypal question of tariffs. She highlighted that the FTSE 100 mightiness beryllium buffered against the harshest drops owed to optimism astir a imaginable US deal, saying: "Not lone is the UK a defensive-style index, particularly the FTSE 100, but it is not facing an contiguous menace of tariffs; adjacent so, the FTSE 100 is inactive pointing to a 0.8% diminution astatine the commencement of this week."

"This does not mean that the UK system volition debar interaction from the tariffs, but it does mean that the UK system could beryllium much resilient than elsewhere. It’s excessively aboriginal to cognize precisely what interaction tariffs volition person connected the planetary economy, but it is just to accidental that they person a precocious imaginable of triggering inflation, and weighing heavy connected planetary growth, including the US economy."