UK FTSE 100 erases gains, turns negative

UK FTSE 100 erases gains, turns negative

The UK FTSE 100 index, which had been on a positive trajectory earlier in the day, turned negative by the afternoon of July 2, 2025. The benchmark index, which had reached 9,226.50 earlier, fell to 9,199.10, marking a decline of 11.76 points or 0.13% [1].

The subdued market sentiment was attributed to several factors. The U.S. Court of Appeals for the Federal Circuit ruled that many of President Donald Trump's tariffs were illegal, which has had significant implications for global trade. The court's 7-4 ruling affirmed a lower court's finding that Trump had exceeded his authority in imposing wide-ranging duties. However, the tariffs were allowed to stay in place until mid-October, providing Trump with time to appeal to the Supreme Court [1].

Among the FTSE 100 constituents, BAE Systems, which rose 2.3% after Norway chose the United Kingdom as its strategic partner for the acquisition of new frigates, was one of the notable performers. Other prominent gainers included Babcock International (+3.75%), Endeavour Mining (+3.3%), and Rolls-Royce Holdings (+2.7%) [1].

Tesco, one of the largest retailers in the UK, also saw a significant increase in its stock price, rising by 2.2%. Other notable performers included Fresnillo (+1.6%) and Pearson (+1.2%) [1].

In economic news, the Nationwide Building Society reported that UK house prices increased by 2.1% on a yearly basis in August, a slower pace compared to the 2.4% rise seen in July. On a monthly basis, house prices edged down by 0.1%, which was slower than the 0.5% increase in the previous month. The Nationwide's Chief Economist, Robert Gardner, attributed the slower pace of house price growth to stretched affordability [1].

The FTSE 100's performance was also influenced by broader market concerns. Market commentators have warned of a potential stock market crash, citing headwinds such as global trade tariffs, rising inflation, uncertainty over central banks' interest rate policies, and geopolitical tensions [2].

Investors are advised to remain cautious and monitor the market closely for any signs of recovery. The FTSE 100's resilience in the face of market volatility demonstrates its ability to bounce back from temporary setbacks, providing opportunities for long-term investors [2].

References:
[1] https://www.nasdaq.com/articles/ftse-100-marginally-bae-systems-tesco-among-prominent-gainers
[2] https://www.fool.co.uk/2025/09/01/2-ftse-100-shares-ill-consider-piling-into-if-the-stock-market-crashes/