Investors Gulp Before Trump ‘Liberation Day’ Tariffs

The FTSE 100 rebounded on Tuesday, recovering from a near three-week low as investors awaited clarity on President Trump’s reciprocal tariff plan that he has dubbed ‘Liberation Day’, set for release at 2000 GMT Wednesday. Wall Street also ended firmer after a choppy session. Reports suggest the new tariffs could apply to nearly all imports, with immediate effect and limited room for negotiation.

Equities

The FTSE 100 rose 0.6% on Tuesday, recovering from a three-week low as investors looked ahead to the Trump administration’s latest tariff announcement. Aerospace and defence stocks led the gains. Rolls-Royce climbed 4.1%, while BAE Systems rose 1.7%. Both companies benefited from renewed interest in defence names amid geopolitical uncertainty. Precious metals miners were also in demand, with the sector up 2.2% as gold hit a fresh record high.

Greencore rallied 5.6% after the convenience food maker upgraded its profit outlook for the year, saying it now expects earnings to come in ahead of market forecasts. Travis Perkins dropped 10.2%, hitting a 15-year low, after warning of continued pressure on demand across the construction sector. Sainsbury lost 2% after analysts at Exane BNP Paribas downgraded the stock to neutral.

In the US, the S&P 500 gained 0.38% and the Nasdaq rose 0.87%, with both indices reversing earlier losses as tech stocks led the rebound. The Dow slipped 0.03%. Investors remain cautious ahead of the White House's tariff announcement scheduled for Wednesday.

Tesla rose 3.6% ahead of its vehicle delivery figures due Wednesday. Amazon, Microsoft, and Meta were also higher, up between 1% and 1.8%, as buyers returned to the large-cap tech names that have come under pressure.

Johnson & Johnson was the weakest stock in the S&P 500, falling 7.6% after a bankruptcy judge rejected the company’s proposed $10 billion settlement aimed at resolving thousands of lawsuits related to its talc-based baby powder.

Recent IPOs saw sharp moves. Newsmax jumped 208%, building on Monday’s explosive NYSE debut. AI-focused firm CoreWeave bounced back 41.8%, moving back above its IPO price after a rocky first few sessions of trading.

Forex & Commodities

The yen strengthened on Tuesday, gaining 0.37% against the US dollar to 149.41, after US manufacturing data showed a contraction in March and job openings fell to 7.568 million. The euro dropped 0.29% versus the dollar, trading at $1.0786.

Markets have increased expectations for European Central Bank rate cuts following weaker economic indicators and growing concerns about the impact of new US trade tariffs.

Gold touched a record high of $3,148.88 an ounce before pulling back to settle at $3,113.43, down 0.3%. US gold futures slipped 0.1% to $3,146. Despite the small decline, gold remains firmly supported by safe-haven demand ahead of the White House’s tariff announcement. The precious metal has just recorded its strongest quarterly performance since 1986.

Analysts at Goldman Sachs increased the probability of a US recession to 35%, adding to speculation that the Federal Reserve may need to cut rates further. Investor demand for bullion has also been boosted by rising ETF holdings and strong central bank buying. Meanwhile, silver fell 1.4% to $33.60, platinum was down 0.8% to $984.64, and palladium eased 0.2% to $981.00.

Oil prices edged lower with Brent crude settling at $74.49 a barrel, down 0.37%, and WTI falling by the same amount to $71.20. The market is awaiting clarity on President Trump’s tariff plan, which includes potential secondary sanctions on Russian oil buyers. Traders are also watching developments around Kazakhstan’s production cuts and an OPEC+ meeting this week (on 5 April), which is expected to confirm a modest output hike for May.