London midday: FTSE off lows but still tanking amid tariff selloff

(Sharecast News) - London stocks were off earlier lows but still sharply in the red by midday on Monday as the Trump tariff selloff continued.

The FTSE 100 was down 3.8% at 7,746.83, recovering from earlier, heavier falls which saw the index drop to a one-year low soon after opening following a bloodbath in Asian trading.

European stocks also came off earlier lows but losses remained substantial, with the benchmark Stoxx Europe 600 index down 5.1%, Germany's DAX 3.8% lower and France's CAC 40 off 4.2%.

Speaking with reporters on board Air Force One on Sunday about recent market volatility, Trump said: "I don't want anything to go down, but sometimes you have to take medicine to fix something and we have such a horrible - we have been treated so badly by other countries because we had stupid leadership that allowed this to happen."

Last week, JPMorgan lifted its odds for a US and global recession to 60% from 40% due to the tariff rollout. Goldman Sachs has also now raised its odds of US recession to 45% from 35%.

Russ Mould, investment director at AJ Bell, said: "It's rare to see double-digit falls in a single day for a major stock index, yet today is one of those days that will go down in history.

"Hong Kong's Hang Seng index dived 13.7% as investors played catch-up in pricing in tariff risks in Asia after parts of its stock market were closed last Friday. In essence, Asia is lumping two horrible days on the market into one.

"That is the fourth biggest one-day decline ever in the Hang Seng. We're seeing the biggest falls in Asia because it arguably has the most to lose from Trump's tariffs.

"Asian countries have thrived from selling goods to the West, with places like the US having been hungry to access cheap labour.

"Asia became a huge manufacturing hub to the US and this situation now threatens to crumble unless Trump backs down or deals can be made to lower tariffs.

"It wasn't just Asia struggling on the markets on Monday. We saw capitulation as indices also slumped across Europe, extending losses from last week and resulting in many blue-chip stocks falling by high single digits and even low double digits.

"This market sell-off feels brutal because it is relentless. Often, we see one or two bad days then a rebound. We're now on day three and the sell-off is intensifying, not dying down.

"Fundamentally, investors are worried about a big hit to corporate earnings and a massive slowdown in economic growth. The potential end to globalisation throws up more questions than answers and that uncertainty is causing havoc on the markets.

"The FTSE 100 didn't have a single stock in positive territory, which illustrates the severity of the situation. Big names that have been winning trades such as defence groups Rolls-Royce and Babcock were on their knees.

"Economic proxies were hit hard, including banks on the prospect of business activity becoming weaker as a result of tariffs. Miners tripped up amid fears of reduced commodities demand if the global economy slows down.

"British Airways owner International Consolidated Airlines dived on the prospect of weaker demand for its transatlantic flights. Tech-related names dropped hard as investor risk appetite vanished into thin air, with Polar Capital Technology Trust and Scottish Mortgage among the biggest fallers on the UK stock market.

"Futures prices imply that Wall Street will continue the doom and gloom when its markets open later on.

"News that more than 50 countries have contacted the US to negotiate tariffs means that investors will be sitting on the edge of their seat waiting to see if anyone strikes a deal with Trump. Tariff-related deals are likely to be high up the list of catalysts to drive a recovery in markets, and the next few weeks are going to be crucial in terms of getting a better idea of the new lay of the land.

"Negotiations may not produce rapid results so there could be prolonged uncertainty and that spells heightened market volatility. Trump will drive a hard bargain and won't back down or soften the blow unless the US gets something big in return."

With stocks a sea of red yet again, the latest house price data from Halifax came and went unnoticed.

It showed that that house prices fell again in March as demand returned to normal after a rush to beat the stamp duty change.

Prices declined by 0.5% on the month following a 0.2% drop in February. On the year, house prices were 2.8% higher in March, unchanged on the previous month.

The average price of a home stood at �296,699 in March, down from �298,274 in February.

Amanda Bryden, head of mortgages at Halifax, said: "House prices rose in January as buyers rushed to beat the March stamp duty deadline. However, with those deals now completing, demand is returning to normal and new applications slowing. Our customers completed more house sales in March than in January and February combined, including the busiest single day on record. Following this burst of activity, house prices, which remain near record highs, unsurprisingly fell back last month.

"Looking ahead, potential buyers still face challenges from the new normal of higher borrowing costs, a limited supply of available properties to choose from, and an uncertain economic outlook.

"However, with further base rate cuts anticipated alongside positive wage growth, mortgage affordability should continue to improve gradually, and therefore we still expect a modest rise in house prices this year."

There were losses across the board in equity markets.

Aerospace manufacturer Melrose Industries was the biggest loser, closely followed by private equity investment firm Intermediate Capital.

Scottish Mortgage Investment Trust - which is heavily-exposed to the US tech sector - was the third worst performer on the FTSE 100.

Market Movers

FTSE 100 (UKX) 7,746.83 -3.83%

FTSE 250 (MCX) 17,678.02 -3.74%

techMARK (TASX) 4,207.30 -3.89%

FTSE 100 - Risers

Entain (ENT) 504.20p 0.60%

RELX FINANCE BV 3.375% GTD NTS 20/03/33 (BW73) 99.72p 0.00%

BAE Systems (BA.) 1,513.00p -0.30%

Taylor Wimpey (TW.) 103.20p -0.43%

Lloyds Banking Group (LLOY) 64.70p -0.46%

Rio Tinto (RIO) 4,195.00p -1.04%

Fresnillo (FRES) 812.50p -1.22%

NATWEST GROUP (NWG) 407.80p -1.35%

Severn Trent (SVT) 2,573.00p -1.61%

Kingfisher (KGF) 248.90p -1.66%

FTSE 100 - Fallers

Melrose Industries (MRO) 395.10p -7.04%

Intermediate Capital Group (ICG) 1,599.00p -6.49%

Scottish Mortgage Inv Trust (SMT) 800.20p -6.45%

Shell (SHEL) 2,335.50p -5.88%

Croda International (CRDA) 2,596.00p -5.74%

Games Workshop Group (GAW) 12,410.00p -5.63%

Halma (HLMA) 2,366.00p -5.44%

WPP (WPP) 515.80p -5.43%

Barclays (BARC) 236.65p -5.36%

International Consolidated Airlines Group SA (CDI) (IAG) 225.40p -5.29%

FTSE 250 - Risers

Ruffer Investment Company Ltd Red PTG Pref Shares (RICA) 294.50p 3.70%

Moonpig Group (MOON) 216.00p 0.47%

Hochschild Mining (HOC) 251.60p 0.16%

International Distribution Services (IDS) 365.20p 0.00%

Tami Senior Securitisation 2 Ltd Cls A-2 Mb Fxd Rte Nts 31/12/23 (Reg S) (BP00) 0.00p 0.00%

TI Fluid Systems (TIFS) 198.80p -0.10%

Renewi (RWI) 853.00p -0.23%

OSB Group (OSB) 391.20p -0.41%

BBGI Global Infrastructure S.A. NPV (DI) (BBGI) 139.40p -0.57%

BH Macro Ltd. GBP Shares (BHMG) 379.00p -0.66%

FTSE 250 - Fallers

Fidelity China Special Situations (FCSS) 211.50p -8.44%

Ocado Group (OCDO) 260.10p -8.42%

Victrex plc (VCT) 725.00p -7.99%

Allianz Technology Trust (ATT) 296.00p -7.64%

Senior (SNR) 117.40p -7.27%

Bridgepoint Group (Reg S) (BPT) 260.80p -6.99%

Pagegroup (PAGE) 260.20p -6.94%

Bakkavor Group (BAKK) 173.40p -6.77%

Polar Capital Technology Trust (PCT) 246.00p -6.64%

Pacific Horizon Inv Trust (PHI) 508.00p -6.62%