The FTSE 100 declined on Friday as concerns about tariffs and poor US tech earnings cast a shadow over European equities.

London’s flagship index was down 0.4% at the time of writing and looked set to close the week out in the red.

“Equity markets were flashing red as Trump’s tariff regime hits another milestone,” said Russ Mould, investment director at AJ Bell.

“Investors have been caught off guard, having previously hoped Trump would kick the new tariff levels down the road pending further negotiations with foreign trade partners. Instead, we’ve got new rates galore and that means investors need to spend time understanding what that means for companies in their portfolio.

“The fact Trump hasn’t chickened out and pushed back the 1 August deadline to 1 September has soured the tone on the markets. Europe and Asia were in a grumpy mood and futures prices imply Wall Street will follow suit later today.”

US tech stocks also played a part in equity declines on Friday. In sharp contrast to yesterday, when Meta helped lift the global equity universe, Amazon’s poor outlook for the rest of the year weighed on already dented sentiment and dragged European indices lower.

“Amazon delivered across the board – but the spotlight was firmly on AWS, and it didn’t quite shine as brightly as expected,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.

“While Microsoft and Alphabet have already shown strong momentum in cloud growth, AWS wasn’t the knockout many wanted to see, highlighting just how tightly investor sentiment is tied to the AI narrative right now. The focus is squarely on Amazon’s cloud business.”

Amazon shares were down 7.5% in the premarket and were set to wipe off a significant number of points from the US indices as cash trading gets underway.

In the UK, Melrose was the FTSE 100’s top riser after reporting a 29% jump in operating profit. The company was one of the most heavily hit FTSE 100 constituents by Trump’s tariffs, so investors will be delighted to see strong underlying performance and a confident outlook. Melrose shares were 6% higher at the time of writing.

IAG was among the losers despite hitting the highest levels since the pandemic earlier in the session after releasing arguably strong results for the first half.

All eyes will be on Non-Farm Payrolls today for further insight into the health of the US economy.

International Airlines Group (IAG) delivered strong financial performance in the first half of 2025, with revenue climbing 8.0% to €15.9 billion as the airline group capitalised on continued robust travel demand.

Operating profit before exceptional items surged 43.5% to €1.88 billion for the six-month period, while second-quarter operating profit jumped 35.4% to €1.68 billion. The company’s operating margin expanded by 2.9 percentage points to 11.8%, reflecting benefits from its ongoing transformation program.

“Our strong performance in the first half of 2025 reflects the resilience of demand for travel and the success of our ongoing transformation,” said Chief Executive Luis Gallego. He noted the company continues to benefit from “the trend of a structural shift in consumer spending towards travel.”

The airline group announced €1.5 billion in cash returns to shareholders for 2025 through dividends and share buybacks. IAG’s balance sheet remained strong with significant free cash flow generation, providing a major positive for investors.

Looking ahead, Gallego expressed confidence that the company will “deliver good earnings growth and margin progression for the full year.” As of July 29, IAG was 57% booked for the second half with booked revenue in line with the previous year.

The company reported robust demand across its core North Atlantic, Latin America and European markets, though noted “some softness in US point-of-sale economy leisure” that was being offset by strength in premium cabins.

“The airline industry has historically been a difficult place to make money, but IAG is a cut above most of the competition. IAG’s performance continued its skyward trajectory, with profits rising at high double-digit rates over the first half,” said Aarin Chiekrie, equity analyst, Hargreaves Lansdown.

“Its largest airline, British Airways, accounts for around 45% of the group’s operating profits and is benefitting from favourable supply and demand dynamics. With a large presence in a constrained London market, British Airways has strong pricing power and looks well-positioned to keep benefiting more than anyone from these dynamics. The group also has exposure to the booming Madrid-Latin America route through its second-largest airline, Iberia. Overall, performance across its airlines has been impressive, and with both fuel and day-to-day costs now forecast to come in below previous guidance, profits look set to continue moving higher.”

IAG shares rose more than 2% on Friday in early trade and are more than 140% higher over the past two years.

Shares in AI-powered design tool Figma soared over 200% in its US debut as investors scrambled to get a piece of one of the most highly anticipated tech IPOs of the last two years.

Figma raised $1.2bn at an IPO price of $33 before the stock rocketed over 200% higher to close at $117, valuing the company at more than $60bn.

Adobe had previously tried to buy Figma for $20bn but was blocked by regulators.

Founded in 2012 with the mission to “eliminate the gap between imagination and reality,” Figma provides online design services for websites, apps, and digital products.

It allows designers, developers, and teams to collaborate in real time on the same file, making it easy to design, prototype, give feedback, and hand off work for development.

The company is profitable, having recorded $44.9m in the first quarter of the year on revenues of $228m. Having generated $749m in revenue in 2024, Figma is clearly still enjoying rapid growth.

Figma has been reported to have over 1,000 clients paying the company more than $100,000 a year, demonstrating Figma’s deep integration into the workflows of some of the world’s biggest tech and design firms.

The FTSE 100 was firmly on the front foot as earnings on both sides of the pond fired up investor sentiment and offset any disappointment around the Fed chair’s hawkish tone on interest rates.

London’s leading index was trading 0.3% higher at 9,169 at the time of writing.

“Stellar results from Microsoft and Meta have fired up investors, quickly shifting the focus from US interest rates potentially staying higher for longer, to an environment where big tech is ruling the roost again,” said Russ Mould, investment director at AJ Bell.

“The probability of a US rate cut in September has fallen since the Fed’s rate decision on Wednesday, with the market now pricing in a 57% chance of rates staying level versus 35% a day ago. Normally, such a shift would be negative for investors who typically prefer rates to be trending lower. However, the big tech reporting season has got everyone excited about mega profits and tremendous earnings growth.”

US stocks sank in the close overnight, but futures rebounded sharply as Meta and Microsoft earnings broke after the bell.

In addition to strong earnings releases from US tech, UK investors were treated to a plethora of upbeat results from FTSE 100 stocks.

Rolls-Royce was the FTSE 100’s top riser after raising its profit guidance for the year following a 50% increase in operating profit in the first half.

“Rolls-Royce continues to soar above expectations, delivering yet another set of high-flying results and profit guidance upgrades. The group produces aeroplane engines for larger, long-haul planes. Revenues are being boosted by the upward trend in engine-flying hours, which are now cruising well above pre-pandemic levels,” explained Aarin Chiekrie, equity analyst, Hargreaves Lansdown.

Rentokil Initial shares soared 9% after the pest control group maintained guidance as its US business surprised investors with rare positivity.

“Having fallen from around the 600p level two years ago, they have been trading around the 350p level in recent weeks, so Rentokil Investors could have been forgiven for feeling like the rats were getting the better treatment,” Steve Clayton, head of equity funds, Hargreaves Lansdown said.

“Today’s news that there are signs of improvement in trading at the Group’s key US Pest division was enough to rally spirits, with investors pushing the stock as much as 12% higher.”

Shell was also among the risers on the news that it would commence a fresh $3.5bn share buyback as cash generation remained robust despite lower oil prices.

Mark Crouch, market analyst for eToro, noted that “Shell delivered results that, while down on last year’s bumper profits, comfortably exceeded analyst expectations. In a weaker oil price environment, the group’s performance has been notably resilient, drawing favourable comparison with US peers rather than its more volatile UK counterpart, BP.”

Shell shares were 2% higher at the time of writing.

Amid the furore surrounding Powell’s press conference and US tech earnings releases, Trump announced that refined metals would be exempt from tariffs, sending metals futures sharply lower.

Lower metals prices translated into a weaker session for the miners as copper pure play Antofagasta tumbled 5%. Glencore, Anglo American, and Rio Tinto were all lower by more than 4%.

The FTSE 100 would likely have broken through 9,200 today if the copper tariff hadn’t been announced overnight.