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Late market roundup: Europe ends higher as tariff hopes rise

Stocks in Europe closed higher on Friday, as investors welcomed signs of progress in US-China trade talks and looked past a hotter US inflation print that may delay rate cuts.

The FTSE 100 index closed 63.31 points, 0.7%, at 8,798.91. The FTSE 250 was up 241.30 points, 1.1%, at 21,715.96, and the AIM All-Share added 2.29 points, 0.3%, at 769.33.

For the week, the FTSE 100 added 0.3%, the FTSE 250 surged 2.7% and the AIM All-Share gained 1.3%.

Over the course of the whole first half of the year, the FTSE 100 has climbed 7.7%

The Cboe UK 100 added 0.7% at 876.15, the Cboe UK 250 rose 1.0% at 19,203.11, and the Cboe Small Companies climbed 1.4% at 17,356.92.

In European equities on Friday, the CAC 40 in Paris jumped 1.8%, while the DAX 40 in Frankfurt surged 1.6%.

The pound was quoted lower at $1.3713 at the time of the London equities close, compared to $1.3733 on Thursday. The euro stood at $1.1717, higher against $1.1698. Against the yen, the dollar was trading higher at JP¥144.75 compared to JP¥144.48.

The yield on the US 10-year Treasury was quoted at 4.27%, narrowing from 4.28%. The yield on the US 30-year Treasury was quoted at 4.82%, narrowing from 4.84%.

In New York, the Dow Jones Industrial Average was up 1.0%, while the S&P 500 and Nasdaq Composite each added 0.6%.

US President Donald Trump’s administration could extend a July deadline when higher tariffs on imports from dozens of countries are set to kick in, the White House said Thursday.

While Trump has imposed a sweeping 10% tariff on most US trading partners this year, he unveiled – then halted – steeper rates on dozens of economies while negotiations took place.

That pause is set to expire July 9.

Asked if there were plans to further the pause, Press Secretary Karoline Leavitt told reporters: ‘Perhaps it could be extended, but that’s a decision for the president to make.’

‘The deadline is not critical,’ she told a media briefing.

The White House signaled trade progress with China on Thursday, with an official saying both sides have reached an understanding on issues including expediting rare earth shipments to the US.

After talks in Geneva in May, Washington and Beijing had agreed to temporarily lower steep tit-for-tat tariffs on each other’s products.

China also committed to easing some non-tariff countermeasures, but US officials later accused Beijing of violating the pact and slow-walking export license approvals for rare earths.

Both sides eventually agreed on a framework to move forward with their Geneva consensus following talks in London this month.

On Thursday, a White House official told AFP that President Trump’s administration and China have ‘agreed to an additional understanding for a framework to implement the Geneva agreement.’

The US Federal Reserve’s key inflationary gauge, the core personal consumption expenditures price index, was higher than anticipated in May, data published by the Bureau of Economic Analysis showed Friday.

Annual core PCE inflation was 2.7% in May, accelerating a notch from 2.6% in April, the latter upwardly revised from 2.5%. Market consensus for May had been 2.6%, according to FXStreet.

With core PCE inflation rising, it is unlikely that the Federal Reserve will cut US interest rates before September, much to the chagrin of President Donald Trump, who is pushing for immediate rate cuts.

The White House said Thursday no decision is imminent on naming a successor to Federal Reserve Chairman Jerome Powell, after a report suggested the president could do so this summer.

‘No decisions are imminent, although the president has the right to change his mind,’ a White House official told AFP.

‘The president has many good options to nominate as the next Federal Reserve chairman,’ the official added.

Powell’s term as chief of the independent central bank ends in May 2026, and the choice of a successor by this summer or fall would be sooner than usual.

But a Wall Street Journal report late Wednesday said President Donald Trump has considered selecting and unveiling Powell’s replacement by September or October.

Among the stocks shining across the Atlantic, Nike jumped 15%. The sportswear firm reported a drop in annual profit amid softer revenue and warned of a $1 billion cost increase in financial 2026 due to new tariffs, which it aims to mitigate through targeted actions across the business.

AJ Bell analyst Russ Mould commented: ‘The footwear manufacturer has brought back Elliott Hill as CEO to drive a turnaround and investors lapped up his every word on plans to get the business back on track with new sports-focused product lines.’

JD Sports rose 7.6%, the athleisure retailer leading the way on the FTSE 100 in a positive read across.

‘A healthier Nike playing catch-up with product innovation could stimulate new demand for its products and theoretically JD Sports would benefit as it is a key retailer of Nike shoes,’ Mould added.

Also on the up in London were stocks with an exposure to China. Among them, luxury fashion firm Burberry added 7.1%.

XTB analyst Kathleen Brooks commented: ‘The key theme for markets in the next week and a half will be US trade agreements, as July 9th is the deadline for the reciprocal tariff reprieve. There has been some good news on this front. Both China and the US have confirmed that they have agreed a trade framework going forward.’

Brent oil was quoted lower at $66.83 a barrel late on Friday afternoon in London from $67.83 late Thursday. Gold fetched $3,273.76 an ounce, lower against $3,322.21.

Weaker gold prices hurt precious metal miners. Hochschild Mining gave back 2.6%.

Elsewhere, Next 15 added 15%, recovering some of its 28% slide from Thursday. It confirmed it is in early talks to dispose of some of its brands, a day after it announced a new chief executive officer and warned on profit.

The London-based business growth consultant said it is actively considering options to speed up value creation across its business units and enhancing the delivery of its commercial and strategic objectives.

‘The board’s primary focus is maximising shareholder value. At this time, there can be no certainty that any agreement will be reached, nor as to the terms of any such agreement, including if sufficient value is not realised. Further updates will be provided as appropriate,’ Next 15 said.

The biggest risers on the FTSE 100 were JD Sports, up 6.18p at 87.88p, Ashtead Group, up 249.00p at 4,732.00p, Melrose Industries, up 18.60p at 536.00p, Standard Chartered, up 33.00p at 1,219.00p, and IMI, up 50.00p at 2,116.00p.

The biggest fallers on the FTSE 100 were Endeavour Mining, down 96.00p at 2,176.00p, Fresnillo, down 63.00p at 1,433.00p, Babcock, down 20.00p at 1,137.00p, BAE Systems, down 25.50p at 1,862.00p, and Coca-Cola Europacific Partners, down 70.00p at 6,640.00p.

Monday’s economic calendar has UK GDP data at 0700 BST and a German inflation reading at 1300 BST. The week picks up pace with eurozone consumer price data and a host of PMI readings on Tuesday. US nonfarm payrolls will be the main event on Thursday, before markets in New York closed for Independence Day on Friday.

On the UK corporate front, grocer Sainsbury’s releases a trading statement on Tuesday.

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