Investors found reasons for optimism this morning as the FTSE 100 and European indices bounced back following a tense trading session gripped by fresh tariff fears. With markets bracing for Wednesday’s policy shift from the US, today’s gains suggest selective confidence is returning, led by a resurgence in financials.
After Monday’s sell-off sparked by concerns over US president Donald Trump’s push for “reciprocal” tariffs, European markets reopened with a stronger tone. The FTSE 100 climbed 0.7% in early trading, driven by a 2% gain in Barclays shares. The financial heavyweight’s performance reflects investor appetite for defensive and well-capitalised institutions amid looming trade policy changes.
In contrast, UK retailers struggled as new data from the British Retail Consortium highlighted a sharp acceleration in food prices during March. Sainsbury’s, Tesco and Marks & Spencer were among the index’s biggest decliners, with mounting concerns around cost pressures. These include the imminent increase in national insurance contributions set to take effect on 6 April, which will further squeeze margins across the sector.
Broader European indices also moved higher. Germany’s DAX rose 0.8%, while France’s CAC 40 gained 0.6%. The pan-European STOXX 600 followed suit, rising 0.7% in anticipation of Eurozone inflation data that will shape future central bank actions.
Meanwhile, US stock futures edged down slightly, suggesting Wall Street is taking a more cautious stance ahead of potential retaliatory trade measures.
The FTSE’s rebound, powered by banking gains, signals selective investor confidence in sectors with strong fundamentals and global exposure. While retail faces margin pressure, the broader European market is eyeing inflation indicators and policy direction.
Fidelity Special Values PLC (LON:FSV) aims to seek out underappreciated companies primarily listed in the UK and is an actively managed contrarian Investment Trust that thrives on volatility and uncertainty.
