London open: Stocks gain amid trade deal optimism

(Sharecast News) - London stocks gained in early trade on Friday as optimism over US trade deals boosted sentiment.

At 0825 BST, the FTSE 100 was 0.4% firmer at 8,561.32.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "The diplomatic offensive presented conjointly by President Trump and Keir Starmer from Washington and Solihull has ignited a feint spark of optimism in equity markets. The coincidence with VE day commemorations seemed designed to underline the special relationship between the two allies. With details emerging late in the day it wasn't enough to prevent a down day on the FTSE - but sentiment has picked up this morning with the index set to open higher.

"There may be some disappointment that the baseline 10% tariffs remain in place but for certain industries the picture on trade restrictions are looking up. While pharmaceuticals have escaped the US Presidents wrath for now, UK companies in the sector and other knowledge-intensive areas have been promised preferential treatment. As yet, that's not come at the expense of lifting the 2% Digital Services Tax Britain applied to the likes of YouTube and eBay, but with more talks to come on a separate digital services deal, it's likely to form part of negotiations."

Investors were also looking ahead to trade talks between the US and China, due to take place over the weekend in Switzerland.

Nathan said: "Donald Trump's hinted there may be some scope to reduce the 145% border tax on Chinese goods if discussions go well. So far, the measures haven't done huge damage to China's economy. Exports from the People's Republic grew 8.1% in April much higher than the 1.9% expected. But, notably, shipments to the US were down 2.5%. That cuts both ways with imports from America falling 4.7%, reflecting the 125% tariff imposed by Beijing.

"But US relations with China aren't quite as friendly as they are with Whitehall and there's speculation that these negotiations could be more protracted."

In equity markets, British Airways owner IAG rose as it held annual guidance after a surge in first-quarter operating profits, adding that second quarter revenue was ahead of last year.

Operating profit before exceptional items increased by �130m to �198m as strong revenue growth and a lower fuel price offset expected cost increases, IAG said.

Rightmove was just a smidgen higher as it reiterated its full-year 2025 guidance, expecting 8% to 10% revenue growth and a 70% underlying operating profit margin, supported by continued ARPA growth and rising membership across its core business.

Travis Perkins rallied after the builders' merchant said it has appointed Gavin Slark - the current chief executive of construction group SIG - as its new CEO with effect no later than 1 January 2026. SIG shares tumbled.

Market Movers

FTSE 100 (UKX) 8,561.32 0.35%

FTSE 250 (MCX) 20,502.52 0.22%

techMARK (TASX) 4,663.14 0.34%

FTSE 100 - Risers

Airtel Africa (AAF) 158.70p 1.73%

BP (BP.) 361.00p 1.55%

GSK (GSK) 1,382.50p 1.36%

Haleon (HLN) 404.30p 1.28%

Smiths Group (SMIN) 2,004.00p 1.26%

Scottish Mortgage Inv Trust (SMT) 957.20p 1.03%

JD Sports Fashion (JD.) 85.34p 0.99%

Pershing Square Holdings Ltd NPV (PSH) 3,664.00p 0.83%

Rentokil Initial (RTO) 353.00p 0.80%

Shell (SHEL) 2,455.00p 0.78%

FTSE 100 - Fallers

Next (NXT) 12,250.00p -0.81%

F&C Investment Trust (FCIT) 1,067.00p -0.65%

International Consolidated Airlines Group SA (CDI) (IAG) 288.60p -0.59%

Bunzl (BNZL) 2,442.00p -0.57%

Diageo (DGE) 2,168.00p -0.50%

BAE Systems (BA.) 1,739.00p -0.40%

Prudential (PRU) 827.40p -0.39%

Anglo American (AAL) 2,038.00p -0.34%

Fresnillo (FRES) 1,027.00p -0.29%

Halma (HLMA) 2,868.00p -0.28%

FTSE 250 - Risers

Dr. Martens (DOCS) 57.90p 4.61%

Travis Perkins (TPK) 603.50p 3.52%

Urban Logistics Reit (SHED) 150.00p 3.02%

Sirius Real Estate Ltd. (SRE) 94.90p 2.98%

Spirent Communications (SPT) 193.40p 2.55%

Trustpilot Group (TRST) 238.00p 2.50%

Oxford Nanopore Technologies (ONT) 133.90p 2.29%

PRS Reit (The) (PRSR) 118.40p 2.25%

Playtech (PTEC) 327.50p 2.18%

Domino's Pizza Group (DOM) 267.60p 2.14%

FTSE 250 - Fallers

AO World (AO.) 96.40p -4.74%

AJ Bell (AJB) 416.00p -4.72%

Bytes Technology Group (BYIT) 515.50p -4.45%

Spire Healthcare Group (SPI) 195.40p -2.20%

Aston Martin Lagonda Global Holdings (AML) 78.05p -2.07%

Marshalls (MSLH) 282.00p -1.91%

Renishaw (RSW) 2,665.00p -1.66%

Murray International Trust (MYI) 270.00p -1.28%

THG (THG) 25.54p -1.08%

Abrdn (ABDN) 155.10p -1.08%