The FTSE 100 moved higher on Friday as investors reacted to news that a US/China trade agreement is a ‘done deal’, according to the US President.
London’s leading index was 0.5% higher at the time of writing.
The US has yet to agree on trade deals with many countries, with damaging tariffs set to come into force on July 8 and 9. However, the White House has signalled some flexibility with these dates and will want to avoid a rerun of the market reaction in April.
Trump is likely to extend any deadlines for major economies should deals not be in place, and this has been reflected in recent strength in equity markets.
That said, the reported deal with China will be a major relief for businesses and investors.
“The FTSE 100 has caught a tailwind from a strong rally in Asian stocks overnight,” said Derren Nathan, head of equity research, Hargreaves Lansdown.
“Exchanges in the Far East latched onto comments by Donald Trump that a ‘very big’ trade deal has been signed between the US and China, while hinting that an agreement with India is imminent. Looking at continental European markets the distinct omission of a timeframe for a deal with the EU may be one reason stock futures across the Channel are pointing downwards.”
US markets powered higher again overnight with the AI-trade back in the driving seat. Strong results from chip maker Micron Technology ignited interest in tech shares such as Meta, Nvidia and Broadcom and the boost to sentiment was felt across European equities on Friday.
“Micron continues to be a beneficiary of the boom in AI demand, though after the huge rebound from April the stock’s reaction was muted. Nonetheless, with the S&P 500 and Nasdaq 100 both back at, or above, previous record highs, it feels like all the tariff worries have receded,” explained Chris Beauchamp, Chief Market Analyst at IG.
JD Sports was the FTSE 100’s top riser after a strong set of results from Nike helped reassure investors. Nike shares were trading 10% higher in the premarket after reporting revenue that fell 12% but beat analysts’ expectations.
A large proportion of JD’s revenue is earned from Nike products, and the poor performance of JD’s share price is linked to recent stuttering growth for Nike.
Nike has been criticised for a lack of innovation, resulting in poor sales performance. Investors will hope the better-than-expected revenue figure demonstrates they are back on track.
“Shares in JD Sports burst to life off the back of Nike’s results,” explained Russ Mould, investment director at AJ Bell.
“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. 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.”
The risk-on feel to trading on Friday was underscored by losses in precious metals miners Endeavour and Fresnillo.
Babcock was the FTSE 100’s top faller as traders booked profits in the stock after a strong run. Babcock shares are 125% higher in 2025 and are the FTSE’s second best performer behind Fresnillo.