The FTSE 100 fell again on Tuesday as the threat of trade tariffs and concerns about interest rates hit market sentiment.
London’s flagship index retreated below 10,100 on Tuesday, trading down 1.1% at the time of writing.
“It’s easy to forget how quickly markets respond to Donald Trump’s outbursts,” said Chris Beauchamp, Chief Market Analyst UK at IG.
“Fresh from a weekend of undermining the Western alliance, the US president’s overnight grenades have thrown diplomats, investors, politicians and global markets into fresh turmoil.”
In addition to the return of concerns about trade tariffs, UK investors were dealt a blow from fresh data on the jobs market, which showed unemployment rising and wage inflation denting any hopes of an interest rate cut in February.
“While unemployment is higher than in recent history, this won’t be enough to move the Bank of England Monetary Policy Committee to move rates, especially whilst wage inflation remains high,” explained Hargreaves Lansdown’s head of personal finance, Sarah Coles.
“There are potential situational factors too – this data includes the pre-Budget period, when uncertainty about taxes and policies meant businesses held off hiring decisions.”
Yesterday, a strong showing from the FTSE 100’s more defensive names helped contain losses. But buying pressure in these sectors waned on Tuesday.
Precious metals miner Endeavour Mining was unsurprisingly higher on the session, but it was among the very few FTSE 100 stocks higher on the session.
Most FTSE 100 shares were trading lower at the time of writing, with investors taking a blanket approach to selling.
Mondi was the FTSE 100’s top faller, losing 3%, as the packaging and paper producer dropped through its 50-day moving average.
AstraZeneca, down 2.8%, wiped a significant number of points from the index as it also moved below a key support level.
JD Sports was one of the heaviest FTSE 100 stocks by Trump’s Liberation Day tariffs last year, and the reignition of trade fears saw the stock down 2.7% on Tuesday.