London Daily

Focus on the big picture.
Friday, Sep 12, 2025

Market Responses to Trade Tariffs: UK Chancellor Addresses Investor Concerns

Market Responses to Trade Tariffs: UK Chancellor Addresses Investor Concerns

Chancellor Rachel Reeves reassures markets as global stock indices begin to recover after recent sell-offs due to US tariffs.
Chancellor Rachel Reeves intervened on Tuesday to address investor concerns following a global stock market sell-off attributed to recent US trade tariffs.

In a statement to parliament, Reeves confirmed that she had communicated with Andrew Bailey, the governor of the Bank of England, who reassured her that "markets are functioning effectively and that our banking system is resilient."

On the same day, stock markets in both the United States and Europe experienced positive movements.

The US Treasury Secretary, Scott Bessent, expressed optimism that the United States could negotiate favorable deals with its trading partners, contributing to renewed investor confidence.

The S&P 500 index increased by 3.3% or 169 points, reaching 5,232 points, while the Dow Jones Industrial Average rose by 3.6%, gaining 1,380 points to settle at 39,346 points.

The tech-focused Nasdaq index saw a 3.7% increase.

In Europe, London's FTSE 100 index climbed by 152 points, up 2%, to 7,854 points, with Germany’s DAX index rising by 1.5% and France’s CAC index increasing by 1.4%.

The broader European Stoxx 600 index rose by 1.7%.

Amid these developments, Reeves reiterated that a trade war "is in nobody's interest" and indicated that the UK government is actively pursuing negotiations for a new trade deal with the US. She is scheduled to meet with Bessent shortly and mentioned recent discussions with counterparts from Canada, Australia, Ireland, France, Spain, and the European Commission, emphasizing efforts to reduce global trade barriers.

Reeves is also set to engage with the Indian government to further these discussions.

While some market indicators showed signs of stabilization, responses in Asia were mixed.

Tokyo's Nikkei index recovered by 5.6%, and Hong Kong's Hang Seng index increased by 1.6% following a significant drop earlier in the week.

Conversely, South Korea’s Kospi index closed up 0.5%, while Taiwan’s TWII index fell by 5%, marking its worst daily decline on record due to heavy reliance on chip exports, which faced a 32% US duty.

Tensions remained high, particularly as the Chinese government warned it would "fight to the end" if the US escalated the trade conflict.

The Chinese Commerce Ministry vowed to implement countermeasures, asserting that they would not relent if the US pursued further tariffs.

Additionally, the European Commission revealed that it had proposed a "zero-for-zero" tariff deal on vehicles and industrial products to the US weeks prior to Trump's imposition of tariffs, indicating that the EU is still open to negotiations.

Amid these unfolding events, investment analysts noted the need for clarity in trade relations.

Matt Britzman, a senior equity analyst, remarked that while the positive movements in European indices were encouraging, they should not be perceived as a definitive resolution to ongoing trade tensions.

He highlighted that developments regarding US-Japan trade discussions could represent a potential pathway to stabilizing markets.

In related economic forecasts, Goldman Sachs predicted that Brent crude oil prices could drop below $40 per barrel in an extreme global economic scenario, following recent lows that saw oil prices fall to less than $64 a barrel before a slight rebound of 0.1% on Tuesday.
Newsletter

Related Articles

0:00
0:00
Close
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Turkish authorities seize leading broadcaster amid fraud and tax investigation
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
ChatGPT CEO signals policy to alert authorities over suicidal youth after teen’s death
The British legal mafia hit back: Banksy mural of judge beating protester is scrubbed from London court
Surpassing Musk: Larry Ellison becomes the richest man in the world
Embarrassment for Starmer: He fired the ambassador photographed on Epstein’s 'pedophile island'
Manhunt after 'skilled sniper' shot Charlie Kirk. Footage: Suspect running on rooftop during panic
Effective Protest Results: Nepal’s Prime Minister Resigns as Youth-Led Unrest Shakes the Nation
Qatari prime minister says Netanyahu ‘killed any hope’ for Israeli hostages
King Charles and Prince Harry Share First In-Person Moment in 19 Months
Starmer Establishes Economic ‘Budget Board’ to Centralise Policy and Rebuild Business Trust
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Brazilian police say ex-President Bolsonaro had planned to flee to Argentina seeking asylum
Trinidad Leader Applauds U.S. Naval Strike and Advocates Forceful Action Against Traffickers
Kim Jong Un Oversees Final Test of New High-Thrust Solid-Fuel Rocket Engine
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Supreme Court temporarily allows Trump to pause billions in foreign aid
Charlie Sheen says his father, Martin Sheen, turned him in to the police: 'The greatest betrayal possible'
Vatican hosts first Catholic LGBTQ pilgrimage
Apple Unveils iPhone 17 Series, iPhone Air, Apple Watch 11 and More at 'Awe Dropping' Event
Pig Heads Left Outside Multiple Paris Mosques in Outrage-Inducing Acts
Nvidia’s ‘Wow’ Factor Is Fading. The AI chip giant used to beat Wall Street expectations for earnings by a substantial margin. That trajectory is coming down to earth.
France joins Eurozone’s ‘periphery’ as turmoil deepens, say investors
On the Anniversary of Queen Elizabeth’s Death: Prince Harry Returns to Britain
France Faces New Political Crisis, again, as Prime Minister Bayrou Pushed Out
Murdoch Family Finalises $3.3 Billion Succession Pact, Ensuring Eldest Son’s Leadership
Big Oil Slashes Jobs and Investments Amid Prolonged Low Crude Prices
Court Staff Cover Up Banksy Image of Judge Beating a Protester
Social Media Access Curtailed in Turkey After CHP Calls for Rallies Following Police Blockade of Istanbul Headquarters
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
Elon Musk Poised to Become First Trillionaire Under Ambitious Tesla Pay Plan
France, at an Impasse, Heads Toward Another Government Collapse
Burning the Minister’s House Helped Protesters to Win Justice: Prabowo Fires Finance Minister in Wake of Indonesia Protests
Brazil Braces for Fallout from Bolsonaro Trial by corrupted judge
The Country That Got Too Rich? Public Spending Dominates Norway Election
Nearly 40 Years Later: Nike Changes the Legendary Slogan Just Do It
Generations Born After 1939 Unlikely to Reach Age One Hundred, New Study Finds
End to a four-year manhunt in New Zealand: the father who abducted his children to the forests was killed, the three siblings were found
Germany Suspends Debt Rules, Funnels €500 Billion Toward Military and Proxy War Strategy
EU Prepares for War
BMW Eyes Growth in China with New All‑Electric Neue Klasse Lineup
Trump Threatens Retaliatory Tariffs After EU Imposes €2.95 Billion Fine on Google
Tesla Board Proposes Unprecedented One-Trillion-Dollar Performance Package for Elon Musk
US Justice Department Launches Criminal Mortgage-Fraud Probe into Federal Reserve Governor Lisa Cook
Escalating Drug Trafficking and Violence in Latin America: A Growing Crisis
US and Taiwanese Defence Officials Held Secret Talks in Alaska
Report: Secret SEAL Team 6 Mission in North Korea Ordered by Trump in 2019 Ended in Failure
×