London city skyline
Stocks and pound perk up / Image source: Adobe

London’s FTSE 100 opened higher on Tuesday, with a slew of central bank decisions and talks between Donald Trump and Russia’s Vladimir Putin on the horizon.

The pound, meanwhile, spiked to $1.3000 in early trade, from $1.2987 at the time of the London equities close on Monday. Sterling was at its best level since November.

The FTSE 100 index traded up 29.82 points, 0.3%, at 8,710.11. The FTSE 250 was up 121.78 points, 0.6%, at 20,149.69, and the AIM All-Share was up 3.76 points, 0.6%, at 692.72.

The Cboe UK 100 was up 0.3% at 870.48, the Cboe UK 250 was 0.9% higher at 17,578.94, and the Cboe Small Companies was flat at 15,608.13.

In Paris, the CAC 40 rose 0.6%, while the DAX 40 in Frankfurt added 0.9%.

The euro rose to $1.0948 from $1.0922. Against the yen, the dollar advanced to JP¥149.88 from JP¥148.57.

‘US data continues to haunt the dollar, which fell against all G10 currencies excluding the yen yesterday,’ ING analysts commented.

‘February retail sales rose less than expected (0.2% month-on-month versus 0.6% consensus) following a major drop in January, while the Empire Manufacturing Index plummeted to the lowest level in more than a year.’

ING added: ‘There is no top-tier data likely to steer the dollar today, although some focus will be on industrial production figures for February and housing starts. Further downside risks for the dollar may stem from today’s Trump-Putin phone call on Ukraine. Any progress towards Russia accepting the ceasefire plan laid out by the US and Ukraine can add extra pressure on the safe-haven dollar and yen.’

US President Donald Trump and Russian leader Vladimir Putin will talk on the telephone later on Tuesday about a possible end to the war in Ukraine.

Following an announcement by Trump, the Kremlin confirmed on Monday that the phone call was planned. According to the US president, he wants to end the war as quickly as possible.

This would be the second phone call between the two presidents since Trump returned to office in January.

Putin recently praised Trump’s efforts to find a solution to the Ukraine conflict, which Moscow sparked by launching a full-scale invasion of its neighbour in February 2022.

The dollar and yen will also be in focus on Wednesday, with rate calls from the Federal Reserve and Bank of Japan on the docket.

The Bank of Japan is expected to keep interest rates steady in its next decision on Wednesday, although a hike later this year is broadly anticipated by analysts.

SPI Asset Management analyst Stephen Innes commented: ‘The BoJ kicked off its two-day policy meeting on Tuesday, with policymakers set to gauge just how much of a threat the escalating US trade war poses to Japan’s economy. Markets are already positioned for further rate hikes this year, but if the BoJ signals dovish intent in Wednesday’s statement, expect the yen to take a hit, fuelling fresh upside in JPY crosses. With Japan’s economic surprises index sinking to its lowest level since January, traders are already on edge, making hedging for those long JPYs, more so on the cross, a no-brainer ahead of the decision.’

The Fed is also expected to leave rates unmoved.

Analysts at Lloyds Bank commented: ‘But expectations for Fed balance sheet policy are offer more interest, with the last minutes mentioning the possibility of a QT slowdown or pause soon.’

In China, the Shanghai Composite ended up 0.1%, while the Hang Seng Index in Hong Kong jumped 2.5%. The Nikkei 225 in Tokyo rose 1.2% and the S&P/ASX 200 in Sydney edged up 0.1%.

In New York on Monday, the Dow Jones Industrial Average traded 0.9% higher, the S&P 500 rose 0.6% and the Nasdaq Composite added 0.3%.

Tuesday’s economic calendar has US industrial production data at 1315 GMT, after a eurozone trade balance reading at 1000 GMT.

A barrel of Brent rose to $71.74 early Tuesday, from $71.04 at the time of the closing bell in London on Monday. Gold rose to $3,024.46 an ounce, a record high, from $2,995.90.

‘In the current environment, every day seems to offer a new catalyst for the gold price,’ XTB analyst Kathleen Brooks commented.

‘Gold miners have generally not followed the gold price too closely so far this year. Miners tend to follow the gold price but with a lag, however, now that the price of gold is comfortably above $3,000 per ounce, it could be time for the gold miners to play catch up. Endeavour Mining, one of the biggest miners on the FTSE 100, has risen by 7% in the past week, at the same time as the gold price rose above $3,000 per ounce. However, there could be further to go, it is still some way from the 2-year high reached in October.’

Spurred on the rising gold price, Fresnillo and Endeavour Mining added 1.5% and 1.4% early Tuesday.

Trustpilot surged 15%. It expects a 2025 outturn ahead of market expectations, after the consumer feedback platform posted a swing to profit for 2024.

Qinetiq lost another 3.9% after a 21% slump on Monday. Shore Capital Markets cuts the stock to ’hold’ from ’buy’.

Close Brothers slumped 13%. The merchant banking firm reported a swing to a first half loss after booking a chunky provision related to motor finance commissions.

Its pretax loss amounted to £103.0 million, swinging from profit of £88.1 million. Operating income weakened 0.3% to £390.0 million from £394.5 million.

‘In light of recent developments in relation to motor finance commissions, the group has reviewed its accounting assessment of these matters. As a result, the group recognised a provision in relation to motor finance commissions of £165 million in the first half. This includes estimates for certain potential operational and legal costs, as well as estimates for potential remediation for affected customers,’ Close Brothers said.

The UK Financial Conduct Authority last week Tuesday said it is no longer planning a further update on its review into past use of motor finance discretionary commission arrangements in May.

This followed the judgement by the Court of Appeal in October, which raised the possibility of more widespread liability for the industry, and the subsequent announcement that the Supreme Court will hear an appeal against the Court of Appeal’s judgement between April 1 to 3.

The Supreme Court is due to hear an appeal brought by car loan providers challenging the October ruling that sided with consumers who complained about ‘secret’ commissions on car loans.

Over in Frankfurt, Rheinmetall added 1.3%, as defence stocks are in focus.

Lawmakers in Germany’s lower house of parliament, the Bundestag, are set to vote on Tuesday on a highly debated €500 billion spending package, aimed at revitalizing infrastructure, advancing climate initiatives and boosting defence.

The proposal, backed by the conservative CDU/CSU bloc, the Social Democrats and the Greens, includes lifting borrowing limits for a special infrastructure and climate fund, while also removing debt restrictions for defence, civil protection, intelligence services and cybersecurity.

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Issue Date: 18 Mar 2025