FTSE 100 live: Barclays and Lloyds jump as market surges on tariff pause

The UK stock market staged one of its strongest opening rebounds ever after Donald Trump announced a 90-day pause in his sweeping trade tariffs.

London’s benchmark FTSE 100 index of top blue-chip companies leapt by some 6 per cent in the first few minutes of trading following a significant rally for markets in the US and Asia. It had lost a little of that pace by lunchtime but was still up by about 4 per cent, flirting with the 8,000 mark. Banks were among the major gainers with Lloyds Banking Group up almost 4 per cent and Barclays, which has a significant presence in the US, jumping 11 per cent.

The market gains came after the US president said he would be delaying tariffs on most nations for 90 days while hiking his tax rate on Chinese imports to 125 per cent.

Market traders have been facing days of share volatility in the wake of Trump's trade tariff announcements.

Nigel Green, chief executive of global financial advisory firm deVere Group, said the world’s two largest economies were “no longer shadowboxing”.

“The escalation is sharp and unmistakable,” he noted. “No longer a war of words, this is now a war of action - and the effects will ripple through every major asset class, industry and economy.

“For investors, this likely marks the start of a period of profound volatility, profound opportunity, and profound risk. When the world’s two largest economies go head-to-head, there are no easy winners - only shifting damage.”

Matt Britzman, senior equity analyst at investment platform Hargreaves Lansdown, added: “The White House has finally seen some sense and given a whole host of countries a 90-day pause, with reciprocal tariffs immediately lowered to 10 per cent, while isolating China in a tense battle. Was this Trump caving to pressure or his master plan all along? Who knows, but markets ripped on the news.

“We still don’t know if this tariff strategy is going to do more harm than good, and this should not be confused with a resolution to the underlying impact on areas like inflation and global growth.”

While the Footsie has rebounded following its downturn in earlier days, the index of the UK's top stocks is still far below where it was in the days before Trump’s tariffs came into force. The US pause has not completely eliminated taxes on goods into America, with the majority of countries now expected to pay a 10 per cent levy, instead of the reciprocal rates Trump’s administration had originally set out.

Despite the changes to the US tariff regime, economists remain concerned that the prolonged uncertainty over Trump’s policy will hold back growth around the world. UK ministers still hope an economic agreement with Washington can be reached to soften the blow of some of the tariffs.

Imports of cars, steel and aluminium to the US are all still subject to a higher 25 per cent tariff.

Chancellor Rachel Reeves is likely to seek to negotiate with the US when she visits Washington at the end of April for the International Monetary Fund’s spring meeting of global finance ministers.

Carsten Brzeski, global head of macro at ING, said the tariff situation was now looking “crazy”.

“US president Trump has decided on a 90-day reprieve for the ‘higher reciprocal tariffs’ for countries that have not ‘retaliated’ against his announcements from last week. That is, all countries except China. Apparently, this shift wasn’t because of the financial market carnage we have been seeing, but Trump declaring ‘a victory’.

“Given that next to Mexico and Canada, the most important trading partners of the US, China and the EU, have not gone into any negotiations, makes this ‘victory’ look like celebrating a big party when your favourite national soccer team just won against San Marino. In all honesty, the current situation is not only chaotic, it’s crazy”

Trump announces 90-day tariff pause for most nations but hikes them for China