Latest news with #Spectris
Daily Mail
4 hours ago
- Business
- Daily Mail
US predators pounce in deals frenzy: Chip designer Alphawave backs £1.8bn bid £3.7bn as Spectris is eyed by Advent
Foreign predators have scooped up two cutting-edge UK-listed firms. The deals announced yesterday are another blow to the battered prestige of the London Stock Exchange. Chip designer Alphawave revealed that it had agreed to a £1.8billion takeover by America software giant Qualcomm. And scientific instruments maker Spectris said it was 'minded to recommend' a £3.7billion approach by US private equity firm Advent. Each firm is being snapped up at nearly twice its market capitalisation – the latest evidence that the bombed out London market is leaving its listed firms severely undervalued. Charles Hall, head of research at broker Peel Hunt, said it showed an 'urgent rethink' is needed. The deals mark the latest setback to the City's ambitions to attract promising growth firms and see them flourish as UK public companies. Instead, firms are stampeding for the exits as they are taken over or choose to cross the pond themselves in search of higher valuations. Yesterday's announcements threatened to overshadow efforts by ministers to showcase Britain's attractiveness to cutting edge companies, at the start of London Tech Week – with a starring role at the event for Jensen Huang, the boss of chip giant Nvidia. Darius McDermott, managing director at research group FundCalibre, said: 'It's a telling contrast – the Prime Minister courts Jensen Huang just as another UK tech success story, Alphawave, is set to be acquired by an American buyer.' Coming just days after fintech firm Wise said it would switch its listing from London to New York, it was 'another sign of UK public markets' fragility', McDermott added. The deal also follows the departures to Wall Street in recent months of betting giant Flutter, building materials firm CRH and equipment hire group Ashtead. Speaking at the start of London Tech Weak, Founders Forum boss Carolyn Dawson said the Wise move should be a 'resounding wake-up call' for the City. Peel Hunt's Hall said there had been 30 bids for major UK companies so far this year at a total value of £25billion, with Spectris and Alphawave the largest. At the same time, there had been just one UK initial public offering at a valuation of more than £100million. 'Companies in the UK seem to be far more attractive to acquirers than investors,' Hall said last night. 'The root cause is the consistent outflow of capital from domestic markets. 'If we want UK equity market to thrive, an urgent rethink is required to ensure that UK capital backs UK companies.' And noting the big premiums of 85 per cent and 96 per cent offered by the buyers of Spectris and Alphawave, Hall added: 'The scale of premiums show how undervalued the UK market is.' Canada-based Alphawave designs chips for data centres, facilities that physically store data, for example for cloud computing. Alphawave listed in London in 2021 in what was then a coup for the City alongside a series of other UK listings, including Wise. For buyer Qualcomm, the takeover helps it diversify away from smartphone chips – a market it dominates but where phone makers such as Apple are increasingly opting for in-house processors. Meanwhile, UK-based Spectris disclosed yesterday that it had received several earlier approaches from Advent, which must make a formal offer by July 7 or walk away, under UK takeover rules.
Times
7 hours ago
- Business
- Times
Spectris shares jump 60% on takeover offer from Advent
One of the UK's leading listed industrial technology companies is to be taken private after receiving a £3.75 billion takeover offer from American private equity. Shares in Spectris, whose stock has been on the slide for the past 18 months, leapt more than 60 per cent on the news. Given the premium that the bidder, Advent International, is prepared to pay — £37.35 a share, more than 80 per cent over the £20.38 closing price of Spectris last week — the board of Spectris confirmed that it was 'minded to recommend unanimously' the offer. Advent is a buyout specialist based in New York that has long been interested in picking up undervalued UK industrial companies and then breaking them up to extract huge profits. In the past six years it has spent £6.6 billion buying Cobham and Ultra Electronics, two substantial FTSE 250 companies, in deals that have subsequently led to a number of divestments. In a statement to the stock market, Spectris said Advent was offering £37.35 cash for every Spectris share and would honour the commitment of Spectris to pay shareholders an already agreed 28p dividend. It said: 'The proposal is subject to satisfaction or waiver of a number of customary pre-conditions, including completion of satisfactory due diligence and agreement of definitive transaction documentation.' Spectris, a leader in high-tech instrumentation and testing equipment, said it had opened its doors for due diligence to begin. Four years ago it proposed a merger with Oxford Instruments that would have made the combined entity a £5 billion world leader in the magnetic resonance imaging scanners used in hospitals. That deal fell apart during the market volatility that followed the Russian invasion of Ukraine. In late 2021 Spectris shares had been trading at more than £40. In the ensuing three years, as Spectris reported falling revenues and profits, the stock halved. During the recent market volatility caused by the Trump trade wars, the shares had fallen to as low as £15. On Monday shares in Spectris closed up £12.26, or 60.2 per cent at £32.64. That was significantly short of the Advent offer, which could indicate some doubt that the transaction will go through at the bid price. 'We and many investors have increasingly seen Spectris as a takeout target, especially with the group having simplified its portfolio in recent years and with it trading at a discount to US peers,' JP Morgan analysts said in a note.
Yahoo
7 hours ago
- Business
- Yahoo
London's FTSE stalls after four-week sprint as trade tensions dominate
By Purvi Agarwal and Pranav Kashyap (Reuters) -London's benchmark equities index was flat on Monday after a four-week bull run, in caution as top U.S. and Chinese officials met in London to try and defuse a high-stakes trade dispute. The FTSE 100 closed flat at 8,832.28 points, while the mid-cap FTSE 250 was up 0.6%. A meeting with top officials from the U.S. and China unfolded in London that investors hope will produce some progress in de-escalating trade tensions between the world's two biggest economies. The discussions emerged from a phone call between the nations' respective presidents last week, where they pledged to continue dialogue amid a trade war that threatens a global supply chain shock and slower economic growth. British finance minister Rachel Reeves will hold a meeting with Chinese vice premier He Lifeng, although there were no details on when the talks would be held. London stocks rounded off the previous week with gains and logged a fourth straight week of advances, the longest in nearly five months. A U.S. jobs report on Friday allayed concerns of an economic slowdown in the world's biggest economy despite a U.S. tariff roller coaster. The non-life insurers index led losses among sectors, ending down 1.3%. Pharma stocks dipped 0.4%, as investors looked to book some profits. Among individual stocks, WPP slipped 2.8% to the bottom of the FTSE 100 after the ad group said its Chief Executive Officer Mark Read would retire by the end of 2025. Spectris soared 60%, leading FTSE 250 gains, after the scientific instruments maker said it has received a takeover proposal from private equity firm Advent valuing its shares at 37.35 pounds per share. Alphawave jumped 18.9% after U.S. chipmaker Qualcomm agreed to acquire the semiconductor company for about $2.4 billion. Asset manager M&G rose 3% after UBS upgraded its rating to 'buy' from 'neutral'. Sign in to access your portfolio
Yahoo
7 hours ago
- Automotive
- Yahoo
Musk row with Trump is ‘damaging' Tesla, warns Wall Street
Tesla stock has been downgraded by two influential investment researchers in the wake of boss Elon Musk's feud with Donald Trump. Shares in the electric car maker dropped by as much as 4.5pc at the opening bell on Wall Street after analysts warned the company faces an uncertain outlook. The stock has dropped about 30pc so far this year. The Tesla boss called for the impeachment of Mr Trump on Thursday in a series of social media posts attacking the president. Mr Trump continued the war of words on Friday when he claimed Mr Musk had 'lost his mind', despite officials claiming he was 'over' their public spat. Argus Research today downgraded Tesla's stock from buy to hold, saying the feud was emblematic of how the stock 'appears to be currently trading on non-fundamentals events'. Analysts said: 'Looking ahead, we are concerned that the war of words between President Trump and Elon Musk, along with expiration of EV credits, could further weaken demand for new Teslas.' Meanwhile, investment bank Baird downgraded its stock recommendation to neutral. Analyst Ben Kallo said: 'The recent incident between Musk and President Trump exemplifies key-person risk associated with Musk's political activities.' He added: 'Additionally, we believe this may heighten questions regarding brand damage, which we expect will persist until sustained evidence of volume growth avails itself.' Thanks for joining us. That's all for today on this blog but you can continue reading all our latest business stories and analysis here. Wall Street is up this evening after the start of trade talks in London between the US and China. The Dow Jones is up 0.1pc, the S&P 500 is up 0.2pc and the Nadaq is up 0.4pc. Jonas Goltermann, of Capital Economics, said: 'With one month to go until the 'pause' of the Trump administration's 'reciprocal tariffs' is, at least in principle, set to expire, market participants continue to take a pretty relaxed view of the risks around US trade policy. 'That probably makes sense, given the administration has ultimately shied away from measures that would do major damage to key asset markets, although there may be some renewed jitters as that deadline draws nearer.' High-tech equipment maker Spectris leapt 64pc today after receiving a more than £3.7bn takeover bid from private equity firm Advent International. Should a firm offer for the FTSE 250 business be made, 'the board has carefully considered the proposal together with its advisers and concluded that the proposal is at a value that the board would be minded to recommend unanimously to Spectris shareholders', said Spectris. Meanwhile, Alphawave IP soared 19pc as it agreed to a $2.4bn (£1.8bn) takeover from US semiconductor firm Qualcomm. Charles Hall at Peel Hunt said: 'Companies in the UK seem to be far more attractive to acquirers than investors. The root cause is the consistent outflow of capital from domestic markets. If we want the UK equity market to thrive, an urgent rethink is required to ensure that UK capital backs UK companies... We believe this can be done through reform of pension funds, ISAs, and stamp duty.' Danni Hewson, head of financial analysis at AJ Bell, said: 'There's been a lot of talk over the past months that investors are increasingly looking beyond the US, and London markets have blossomed since the start of the year, but many UK companies still look cheap and that's likely to keep the takeover offers coming.' FTSE 100 closed down less than 0.1pc in quiet trading, while the mid-cap FTSE 250 finished up 0.6pc. Global markets have been mixed today as investors wait to see the outcome of trade talks between Washington and Beijing in London. In Europe, the German Dax fell 0.5pc, while the French Cac 40 lost 0.2pc. On Wall Street, the S&P 500 is up 0.1pc, the Nasdaq is up 0.3pc and the Dow Jones is down by 0.1pc. The MSCI World index, a measure of global stock prices, is up 0.2pc. Oil has risen today as traders were encouraged by trade talks between the US and China taking place in London. The cost of a barrel of Brent crude rose 0.71pc to around $67. Prices had been depressed on fears that escalating trade barriers would curb economic growth and subdue demand. David Morrison, senior market analyst at Trade Nation, said: 'Last week's move off the lows was driven by a combination of an improving demand growth outlook and as investors repositioned themselves ahead of today's US-China trade talks. 'These couldn't come soon enough for investors. And there was a stark indication of the damage already done by the Trump administration's tariffs following the release of Chinese data overnight. China's crude oil imports hit their lowest daily rate in four months, although much of this can be blamed on planned maintenance. 'More seriously, export growth hit a three-month low in May, while wholesale deflation accelerated, coming in at its worst level since Aug 2023.' Canadians are ditching holidaying in the US this summer as part of a backlash against Donald Trump's trade war. Just 10pc of Canadians plan to visit their southern neighbour this summer, compared to 23pc last year, according to a poll by Leger Marketing. It comes after official figures from Statistics Canada showed that the number of Canadians driving to the US dropped 35pc in April, while air travel fell 20pc. A substantial trade deal between the US and China is 'unlikely', an analyst has claimed, because so many of the key figures in the Trump administration are China hawks. Ian Bremmer, head of the geopolitical risk firm Eurasia Group, said while a temporary truce was possible, there was little prospect for the bilateral relationship to become constructive. He pointed to the trend towards 'decoupling' from China and continued US pressure on other countries to take China out of their supply chains. He told clients: 'Everyone around Trump is still hawkish and so a breakthrough US-China trade deal is unlikely, especially in the context of other deals that are further along and prioritised.' US stocks are struggling for direction this afternoon as the world's largest economy began talks on trade with China that could help avoid a recession. The S&P 500 is flat, while the Nasdaq is up 0.4pc and the Dow is down 0.4pc. Hopes that President Donald Trump will lower his punitive tariffs on China another others are among the main reasons the S&P 500 has rallied back strongly since dropping roughly 20pc from its record two months ago. Huge sectors of the US economy rely on foreign labour face 'serious disruptions' as a result of Donald Trump's immigration crackdown, according to a top economist. Mark Zandi, chief economist at Moody's Analytics, said the latest US jobs figures showed labour force growth was at a 'standstill', with 'disconcerting' implications for the construction, agriculture, hospitality and retailing industries. He warned that the switch away from cheaper foreign labour would also lead to higher inflation, 'just when the higher tariffs are set to push up prices'. Tesla stock has been downgraded today by two influential investment researchers in the wake of boss Elon Musk's deepening feud with Donald Trump. Shares in the electric car maker dropped by as much as 4.5pc at the opening bell on Wall Street after analysts warned the company faces an uncertain outlook. The stock has dropped about 30pc so far this year. The Tesla boss called for the impeachment of Mr Trump on Thursday in a series of social media posts attacking the president. Mr Trump continued the war of words on Friday when he claimed Mr Musk had 'lost his mind', despite officials claiming he was 'over' their public spat. The President continued the war of words on Friday when he claimed Mr Musk had 'lost his mind', despite officials claiming he was 'over' their public spat. Argus Research today downgraded Tesla's stock from buy to hold, saying the feud was emblematic of how the stock 'appears to be currently trading on non-fundamentals events'. Analysts said: 'Looking ahead, we are concerned that the war of words between President Trump and Elon Musk, along with expiration of EV credits, could further weaken demand for new Teslas.' Meanwhile, investment bank Baird downgraded its stock recommendation to neutral. Analyst Ben Kallo said: 'The recent incident between Musk and President Trump exemplifies key-person risk associated with Musk's political activities.' He added: 'Additionally, we believe this may heighten questions regarding brand damage, which we expect will persist until sustained evidence of volume growth avails itself.' The US wants China to agree a deal on rare earths during talks in London, according to one of Donald Trump's top officials. US economic adviser Kevin Hassett said the American team wanted a handshake from their counterparts rare earths after Presidents Donald Trump and Xi Jinping spoke last week. 'The purpose of the meeting today is to make sure that they're serious, but to literally get handshakes,' he told CNBC. He said the expectation was that immediately after any agreement, export controls would be eased and rare earths released in volume. Wall Street's main indexes edged higher as a fresh round of negotiations between the United States and China got under way in London. The Dow Jones Industrial Average rose 23.3 points, or 0.1pc, at the opening bell to 42,786.19. The S&P 500 rose 4.3 points, or 0.1pc, to 6,004.63, while the Nasdaq Composite rose 43.2 points, or 0.2pc, to 19,573.14. US treasury secretary Scott Bessent was pictured arriving for the trade talks with China at Lancaster House in London. China and the United States have begun a new round of trade talks in London, Beijing's state media reported. 'On June 9, local time, Vice Premier He Lifeng... began holding the first meeting of the China-US trade consultation mechanism with the American side in London,' state news agency Xinhua said. Government borrowing costs are edging higher ahead of an auction this week of US Treasuries which could indicate how confident investors are in the American economy. The US Treasury will auction $22bn of 30-year bonds on Thursday. Any sign of weak demand could push yields higher – and thus the cost of government borrowing. Treasury yields were flat today, while the 10-year UK gilt yield was last up one basis point to 4.65pc. Oxford Economics analyst John Canavan warned that borrowing costs could also be pushed up in the near future by strong US economic data, which could mean the Federal Reserve will delay cuts to interest rates. Bond yields could also rise over concerns about President Trump's 'one big beautiful bill' of tax cuts working its way through Congress, as well as from 'increased uncertainty in the face of President Trump's mercurial policy decisions'. Mr Canavan said: 'The 10-year and 30-year Treasury auctions this week could potentially suffer from those factors, whichcould add to the near-term pressure on the long end. 'Slower economic growth and upward pressure on inflation over the next couple of quarters could add fuel to deficit fears, potentially creating a cycle of fiscal concerns increasing higher term premiums, which will increase Treasury rates, raising government funding costs, and increasing fiscal concerns again.' Donald Trump's crackdown on immigration will end the era of strong growth in the US economy, a Wall Street banking giant has warned. The US president's hard line on immigration will cause a 'swing from strength to weakness' in America's ability to attract new entrants to the labour market, analysts at JP Morgan said. Demonstrators protesting against federal immigration raids have clashed with police in Los Angeles since late last week, with President Trump ordering 2,000 members of the National Guard to the California city over the weekend. JP Morgan indicated the tightening of US immigration policy would 'weigh on the expansion' in the economy. Meanwhile, the 'uncertain' outlook for US trade policy would also define what happens in the second half of the year, with the effective tariff rate of nearly 15pc 'only just now taking full effect'. JP Morgan said the economy further faced hit from a decline in federal and local government spending, which is on track to grow at a reduced pace of 1pc, compared to 3.8pc over the last two years. JP Morgan chief economist Bruce Kasman said: 'A less appreciated slowdown in US government spending and tightening in immigration policy are set to weigh on the expansion.' He added: 'These policy shifts are largely a US story and are reflected in our forecast that a period of sustained above-potential US growth is over.' China's meeting with US officials in London comes as Beijing also launches discussions with other trading partners in a bid to build a united front to counter Donald Trump's tariffs. It has held talks with Japan and South Korea, and on Thursday it turned to Canada, with the two sides agreeing to regularise their channels of communication after a period of strained ties. Canadian prime minister Mark Carney and Chinese premier Li Qiang also discussed trade and the fentanyl crisis, Ottawa said. Beijing has also proposed establishing a 'green channel' to ease the export of rare earths to the European Union, and the fast-tracking approval of some export licences. China is expected to host a summit with the EU in July, marking 50 years since Beijing and Brussels established diplomatic ties. US stock index were subdued as investors looked ahead to the trade talks between the United States and China in London. Top officials from both countries will meet after Beijing and Washington accused each other of violating a preliminary agreement struck last month in Geneva that had briefly cooled tensions between the world's largest economies. The second-round of meetings comes four days after Donald Trump and Xi Jinping spoke by phone, their first direct interaction since Trump's January 20 inauguration. The benchmark S&P 500 closed above 6,000 on Friday for the first time since February 21, following a better-than-expected jobs report and a rebound in Tesla's shares. Hopes of more trade deals between the US and its major trading partners, along with upbeat earnings and tame inflation data, helped American stocks rally in May, with the S&P 500 and the tech-heavy Nasdaq notching their best monthly gains since November 2023. The S&P 500 remains a little over 2pc below all-time highs touched in February, while the Nasdaq is about 3pc below its record peaks reached in December. In premarket trading, the S&P 500 and Dow Jones Industrial Average were flat, while the Nasdaq 100 was down 0.1pc. One of Wall Street's biggest banks has pushed back its forecasts for US interest rate cuts this year amid signs the American jobs markets is holding up better than expected. Citigroup said it expects the next US rate cut will happen in September rather than July after the stronger-than-expected May jobs report. Nonfarms payrolls grew by 139,000 in May, similar to the downwardly revised 147,000 in April and better than the 126,000 forecast. As a result, Citi said it expects the US Federal Reserve will only cut rates three times this year, compared to previous predictions of four cuts, in September, October and December. Money markets indicate there will be fewer than two reductions in borrowing costs in 2025. It comes after the Wall Street bank lifted its target for the benchmark S&P 500 stock index to 6,300 by the end of the year, up from 5,800 earlier. The benchmark S&P 500 index closed above 6,000 for the first time since late February on Friday amid a bounceback from Donald Trump's tariff onslaught. The US president has been urging the Fed to cut interest rates to boost the economy. An index tracking emerging market currencies hit a record high ahead of the US-China trade talks in London. The MSCI index of emerging market currencies was up 0.2pc at an all-time high as the dollar continued to weaken. Trading was subdued with several markets, such as Hungary, Romania, and Turkey, closed for public holidays. Meanwhile, a broad index for emerging market stocks jumped about 1pc to hit a more than three-year high. Global markets were pinning their hopes on the talks between representatives from Washington and Beijing in London on Monday, which could potentially improve growth worldwide. Oil prices have steadied after recent strong gains ahead of the latest US-China talks. Brent crude traded 0.2pc higher above $66 a barrel after jumping 4pc last week, while West Texas Intermediate was near $65. Negotiators from the US and China were poised to hold talks in London today, raising hopes that the world's two largest economies can de-escalate their trade war. Crude has retreated by 11pc this year over concerns that the trade tensions could hinder global growth, which could hamper demand for energy. At the same time, the Opec+ cartel of oil-producing nations has been ramping up production at a faster-than-anticipated pace, underpinning fears that there will be a glut of oil in the second half of this year. A semiconductor specialist is set to become the latest British company to quit the London stock market after agreeing to a $2.4bn (£1.8bn) takeover by an American rival. Alphawave IP Group said on Monday it was recommending shareholders to vote for a sale to US chip giant Qualcomm. The deal would mean the company, which only floated on the London Stock Exchange four years ago, would cease to be listed. It is a fresh blow to the City just days after Wise, the British financial technology champion, announced it was moving its main listing to New York. Global markets were mixed as investors waited to see the outcome of trade talks between Washington and Beijing in London. The FTSE 100 was little changed at 8,834.30, while the Cac 40 in Paris lost 0.2pc to 7,792.44 and Germany's Dax edged 0.4pc lower to 24,215.67. The Dow Jones Industrial Average and S&P 500 were flat in premarket trading in New York. However, it was a different story in Asia as teams from the US and China prepared to conduct trade negotiations in London. In South Korea, the Kospi added 1.6pc to 2,855.77 and Chinese markets rose even though the government reported that exports slowed in May. Exports to the United States fell nearly 35pc in May and nearly 10pc in January-May in annual terms. China also reported that consumer prices fell 0.1pc in May from a year earlier, marking the fourth consecutive month of deflation. Hong Kong's Hang Seng picked up 1.6pc to 24,181.43, which was its highest level since March 21, while the Shanghai Composite Index climbed 0.4pc to 3,399.77. Tokyo's Nikkei 225 gained 0.9pc to 38,088.57 as the government reported that the Japanese economy contracted by 0.2pc in the January-March quarter. China wants to deepen its relationship with Britain, its vice premier has said after a meeting with Rachel Reeves. He Lifeng met with the Chancellor in London today ahead of his talks with a US trade delegation in the capital. He called for deeper financial and economic cooperation with Britain, according to China Central Television. The vice premier also urged Britain and China to maintain a stable relationship. Ms Reeves said Britain 'attaches great importance to cooperation with China and is willing to strengthen communication', according to the CCTV report. China inflation dropped last month for the fourth time in a row, official data showed, adding to concerns about the world's second largest economy. The National Bureau of Statistics (NBS) showing the consumer price index dropped 0.1pc in May. The reading, which was slightly better than expected but marks the fourth straight month of falling prices, comes as Beijing struggles to boost domestic consumption that has been sluggish since the end of the pandemic. The failure of leaders to kickstart demand threatens their official growth targets and complicates their ability to shield the economy from President Trump's tariff blitz. While deflation suggests the cost of goods is falling, it poses a threat to the broader economy as consumers tend to postpone purchases under such conditions in the hope of further reductions. The value of the dollar slipped against all major currencies ahead of the pivotal US-China trade talks. The pound was up 0.4pc against the greenback at $1.357 while the euro gained 0.3pc to $1.143. Charu Chanana, chief investment strategist at Saxo Markets, said: 'A deal to keep talking might be better than nothing, but unless we see a concrete breakthrough, the impact on sentiment is likely to remain muted.' The dollar had been lifted on Friday after better than expected US employment figures, which indicated the American economy was doing better than expected. However, the US currency remains down more than 8.6pc against major currencies so far this year. China 'holds the upper hand' in the mining and processing of rare earths, which will be a focal point in the trade talks with the US in London. The materials are crucial for not only cars but also a range of other products from robots to military equipment. The Chinese government started requiring producers to obtain a licence to export seven rare earth elements in April. Resulting shortages sent prompted fears among some car makers that they would have to halt production. President Trump, without mentioning rare earths specifically, took to social media to attack China at the end of last month, accusing it of violating its trade deal made in Geneva. The Chinese government indicated Saturday that it is addressing the concerns, which have come from European companies as well. A Commerce Ministry statement said it had granted some approvals and 'will continue to strengthen the approval of applications that comply with regulations.' The scramble to resolve the rare earth issue shows that China has a strong card to play if it wants to strike back against tariffs or other measures. Richard Hunter, an analyst at Interactive Investor, said: 'Despite the President's previous rhetoric, there seems to be some possibility that some of this aggression will be dialled back, not least of which since China has an upper hand especially with regard to its near monopoly on rare earth minerals which are so vital for components in the high-tech industry. 'China may also be keen on conciliation since there are further signs that its economy is struggling to fend off the tariff pressures so far.' The cost of government borrowing edged lower in Britain ahead of the talks between top US and Chinese trade officials in London. The yield on 10-year UK gilts – a benchmark for the cost of servicing the national debt – declined two basis points to 4.62pc on bond markets. Yields were also lower across the eurozone after the European Central Bank last week cut interest rates by a quarter of a percentage point to 2pc, as expected. Germany's 10-year bund yield was down nearly three basis points to 2.54pc. The FTSE 100 opened slightly higher as the US and China prepare to hold trade talks in London. The UK's blue-chip stock index climbed 0.1pc to 8,845.73 while the mid-cap FTSE 250 was flat at 21,159.10. Donald Trump said the talks in London 'should go very well'. The negotiations come just a few days after the US president and Xi Jinping finally held their first publicly announced telephone talks since the Republican returned to the White House. Trump said the call, which took place on Thursday, had reached a 'very positive conclusion.' Xi was quoted by state-run news agency Xinhua as saying that 'correcting the course of the big ship of Sino-US relations requires us to steer well and set the direction'. The call came after tensions between the world's two biggest economies had soared, with Trump accusing Beijing of violating a tariff de-escalation deal reached in Geneva in mid-May. Mr Trump's press secretary, Karoline Leavitt, told Fox News on Sunday: 'We want China and the United States to continue moving forward with the agreement that was struck in Geneva.' China's export growth slowed to a three-month low in May as US tariffs hit shipments. Total exports from the world's second largest economy expanded by 4.8pc year-on-year last month, down from 8.1pc in April and below analyst expectations of 5pc, according to customs data. China's exports to the US plunged by 34.5pc in the sharpest drop since the outbreak of the Covid pandemic in February 2020. Imports dropped 3.4pc, deepening sharply from the 0.2pc decline in April, despite the trade deal agreed between Beijing and Washington in Geneva at the start of last month. Zichun Huang of Capital Economics said: 'The slowdown in export growth in May should partially reverse this month, as it reflects the drop in US orders before the trade truce, which took time to feed through to actual shipments. 'But with tariffs likely to remain elevated and Chinese manufacturers facing broader constraints on their ability to sustain rapid gains in global market share, we think export growth will slow further by year-end.' Top US and Chinese officials will sit down in London today for talks aimed at defusing the high-stakes trade dispute between the two superpowers. Their trade war has deepened in recent weeks beyond tit-for-tat tariffs to export controls over goods and components critical to global supply chains. At a still-undisclosed venue in London, the two sides will try to get back on track with a preliminary agreement struck last month in Geneva. The US delegation will be led by treasury secretary Scott Bessent, commerce secretary Howard Lutnick and US trade representative Jamieson Greer. The Chinese contingent will be helmed by vice premier He Lifeng. A UK Government spokesman said: 'The next round of trade talks between the US and China will be held in the UK on Monday. 'We are a nation that champions free trade and have always been clear that a trade war is in nobody's interests, so we welcome these talks.' Investors in Europe appear more sceptical about the prospects of the US-China trade talks kicking off in London today. The FTSE 100, France's Cac 40 and Germany's Dax are all on track to open flat when trading gets underway later. Kathleen Brooks, research director at XTB, said: 'Asian stocks are rallying at the start of the week; however, European equity futures and US futures are taking a breather and are pointing to a slightly lower open later today.' She added: 'Stocks may need a new driver to extend last week's rally after investors scaled back their expectations for Federal Reserve interest rates cuts for this year. There are less than two cuts priced in by the Fed Fund Futures market by the end of this year. 'The number of rate cuts from the Fed could be determined by the outlook for US inflation, which is released later this week. As the growth data remain unaffected by tariffs for now, inflation could hold the key for US monetary policy.' Thanks for joining me. Stock markets jumped in Asia ahead of US-China trade talks due to get under way in Britain today. Shares were up from Hong Kong to Tokyo following a call late last week between US president Donald Trump and Chinese leader Xi Jinping. Representatives from the world's two largest economies are due to meet at a still undisclosed location in London in an attempt to revive a preliminary trade agreement reached in Geneva last month. The US delegation will be led by treasury secretary Scott Bessent, commerce secretary Howard Lutnick and US trade representative Jamieson Greer. The Chinese contingent will be helmed by vice premier He Lifeng. Relations soured earlier this month after President Trump accused China of violating the terms of the deal. Beijing accused Washington of doing the same. 1) Ukraine plots fracking revolution | Ukraine is working to unleash natural gas fracking with the goal of becoming a major exporter and revolutionising Europe's energy market 2) John Lewis to slim down staff committee to accelerate decisions | Retail giant to cut size of partnership council to 43 in bid to boost turnaround 3) British manufacturing is dying before our eyes | Labour needs to take bold action to lower energy costs in this week's industrial strategy 4) How £7 pints are destroying Britain's pubs | Rising costs are forcing beleaguered publicans to raise prices, driving cash-strapped customers away 5) Lawyer who acted for Gerry Adams to pursue chatbots for libel | The high-profile media lawyer who represented Gerry Adams in his libel trial against the BBC is now preparing to sue the world's most powerful AI chatbots for defamation. Shares rose in Asia ahead of the second round of trade talks between Washington and Beijing, due later today in London. In South Korea, the Kospi added 1.9pc to 2,865.52. Chinese markets rose even though the government reported that exports slowed in May, growing 4.8pc from a year earlier after a jump of more than 8pc in April. Exports to the United States fell nearly 10pc compared with a year earlier. China also reported that consumer prices fell 0.1pc in May from a year earlier, marking the fourth consecutive month of deflation. Hong Kong's Hang Seng picked up 1.4pc to 24,119.64 while the Shanghai Composite Index climbed 0.4pc to 3,397.13. Tokyo's Nikkei 225 gained 1.1pc to 38,137.09 as the government reported that the Japanese economy contracted by 0.2pc in the January-March quarter. Australia's market was closed for a public holiday. On Friday, stocks gained ground on Wall Street following a better-than-expected report on the US job market. The gains were broad, with every sector in the S&P 500 rising. That solidified a second consecutive winning week for the benchmark index, which has rallied back from a slump two months ago to come within striking distance of its record high. The S&P 500 rose 1pc to 6,000.36. The Dow Jones Industrial Average added 1pc to 42,762.87 while the Nasdaq gained 1.2pc, to 19,529.95. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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Musk row with Trump is ‘damaging' Tesla, warns Wall Street
Tesla stock has been downgraded by two influential investment researchers in the wake of boss Elon Musk's feud with Donald Trump. Shares in the electric car maker dropped by as much as 4.5pc at the opening bell on Wall Street after analysts warned the company faces an uncertain outlook. The stock has dropped about 30pc so far this year. The Tesla boss called for the impeachment of Mr Trump on Thursday in a series of social media posts attacking the president. Mr Trump continued the war of words on Friday when he claimed Mr Musk had 'lost his mind', despite officials claiming he was 'over' their public spat. Argus Research today downgraded Tesla's stock from buy to hold, saying the feud was emblematic of how the stock 'appears to be currently trading on non-fundamentals events'. Analysts said: 'Looking ahead, we are concerned that the war of words between President Trump and Elon Musk, along with expiration of EV credits, could further weaken demand for new Teslas.' Meanwhile, investment bank Baird downgraded its stock recommendation to neutral. Analyst Ben Kallo said: 'The recent incident between Musk and President Trump exemplifies key-person risk associated with Musk's political activities.' He added: 'Additionally, we believe this may heighten questions regarding brand damage, which we expect will persist until sustained evidence of volume growth avails itself.' Thanks for joining us. That's all for today of this blog but you can continue reading all our latest business stories and analysis here. Wall Street is up this evening after the start of trade talks in London between the US and China. The Dow Jones is up 0.1pc, the S&P 500 is up 0.2pc and the Nadaq is up 0.4pc. Jonas Goltermann, of Capital Economics, said: 'With one month to go until the 'pause' of the Trump administration's 'reciprocal tariffs' is, at least in principle, set to expire, market participants continue to take a pretty relaxed view of the risks around US trade policy. 'That probably makes sense, given the administration has ultimately shied away from measures that would do major damage to key asset markets, although there may be some renewed jitters as that deadline draws nearer.' High-tech equipment maker Spectris leapt 64pc today after receiving a more than £3.7bn takeover bid from private equity firm Advent International. Should a firm offer for the FTSE 250 business be made, 'the board has carefully considered the proposal together with its advisers and concluded that the proposal is at a value that the board would be minded to recommend unanimously to Spectris shareholders', said Spectris. Meanwhile, Alphawave IP soared 19pc as it agreed to a $2.4bn (£1.8bn) takeover from US semiconductor firm Qualcomm. Charles Hall at Peel Hunt said: 'Companies in the UK seem to be far more attractive to acquirers than investors. The root cause is the consistent outflow of capital from domestic markets. If we want the UK equity market to thrive, an urgent rethink is required to ensure that UK capital backs UK companies... We believe this can be done through reform of pension funds, ISAs, and stamp duty.' Danni Hewson, head of financial analysis at AJ Bell, said: 'There's been a lot of talk over the past months that investors are increasingly looking beyond the US, and London markets have blossomed since the start of the year, but many UK companies still look cheap and that's likely to keep the takeover offers coming.' FTSE 100 closed down less than 0.1pc in quiet trading, while the mid-cap FTSE 250 finished up 0.6pc. Global markets have been mixed today as investors wait to see the outcome of trade talks between Washington and Beijing in London. In Europe, the German Dax fell 0.5pc, while the French Cac 40 lost 0.2pc. On Wall Street, the S&P 500 is up 0.1pc, the Nasdaq is up 0.3pc and the Dow Jones is down by 0.1pc. The MSCI World index, a measure of global stock prices, is up 0.2pc. Oil has risen today as traders were encouraged by trade talks between the US and China taking place in London. The cost of a barrel of Brent crude rose 0.71pc to around $67. Prices had been depressed on fears that escalating trade barriers would curb economic growth and subdue demand. David Morrison, senior market analyst at Trade Nation, said: 'Last week's move off the lows was driven by a combination of an improving demand growth outlook and as investors repositioned themselves ahead of today's US-China trade talks. 'These couldn't come soon enough for investors. And there was a stark indication of the damage already done by the Trump administration's tariffs following the release of Chinese data overnight. China's crude oil imports hit their lowest daily rate in four months, although much of this can be blamed on planned maintenance. 'More seriously, export growth hit a three-month low in May, while wholesale deflation accelerated, coming in at its worst level since Aug 2023.' Canadians are ditching holidaying in the US this summer as part of a backlash against Donald Trump's trade war. Just 10pc of Canadians plan to visit their southern neighbour this summer, compared to 23pc last year, according to a poll by Leger Marketing. It comes after official figures from Statistics Canada showed that the number of Canadians driving to the US dropped 35pc in April, while air travel fell 20pc. A substantial trade deal between the US and China is 'unlikely', an analyst has claimed, because so many of the key figures in the Trump administration are China hawks. Ian Bremmer, head of the geopolitical risk firm Eurasia Group, said while a temporary truce was possible, there was little prospect for the bilateral relationship to become constructive. He pointed to the trend towards 'decoupling' from China and continued US pressure on other countries to take China out of their supply chains. He told clients: 'Everyone around Trump is still hawkish and so a breakthrough US-China trade deal is unlikely, especially in the context of other deals that are further along and prioritised.' US stocks are struggling for direction this afternoon as the world's largest economy began talks on trade with China that could help avoid a recession. The S&P 500 is flat, while the Nasdaq is up 0.4pc and the Dow is down 0.4pc. Hopes that President Donald Trump will lower his punitive tariffs on China another others are among the main reasons the S&P 500 has rallied back strongly since dropping roughly 20pc from its record two months ago. Huge sectors of the US economy rely on foreign labour face 'serious disruptions' as a result of Donald Trump's immigration crackdown, according to a top economist. Mark Zandi, chief economist at Moody's Analytics, said the latest US jobs figures showed labour force growth was at a 'standstill', with 'disconcerting' implications for the construction, agriculture, hospitality and retailing industries. He warned that the switch away from cheaper foreign labour would also lead to higher inflation, 'just when the higher tariffs are set to push up prices'. Tesla stock has been downgraded today by two influential investment researchers in the wake of boss Elon Musk's deepening feud with Donald Trump. Shares in the electric car maker dropped by as much as 4.5pc at the opening bell on Wall Street after analysts warned the company faces an uncertain outlook. The stock has dropped about 30pc so far this year. The Tesla boss called for the impeachment of Mr Trump on Thursday in a series of social media posts attacking the president. Mr Trump continued the war of words on Friday when he claimed Mr Musk had 'lost his mind', despite officials claiming he was 'over' their public spat. The President continued the war of words on Friday when he claimed Mr Musk had 'lost his mind', despite officials claiming he was 'over' their public spat. Argus Research today downgraded Tesla's stock from buy to hold, saying the feud was emblematic of how the stock 'appears to be currently trading on non-fundamentals events'. Analysts said: 'Looking ahead, we are concerned that the war of words between President Trump and Elon Musk, along with expiration of EV credits, could further weaken demand for new Teslas.' Meanwhile, investment bank Baird downgraded its stock recommendation to neutral. Analyst Ben Kallo said: 'The recent incident between Musk and President Trump exemplifies key-person risk associated with Musk's political activities.' He added: 'Additionally, we believe this may heighten questions regarding brand damage, which we expect will persist until sustained evidence of volume growth avails itself.' The US wants China to agree a deal on rare earths during talks in London, according to one of Donald Trump's top officials. US economic adviser Kevin Hassett said the American team wanted a handshake from their counterparts rare earths after Presidents Donald Trump and Xi Jinping spoke last week. 'The purpose of the meeting today is to make sure that they're serious, but to literally get handshakes,' he told CNBC. He said the expectation was that immediately after any agreement, export controls would be eased and rare earths released in volume. Wall Street's main indexes edged higher as a fresh round of negotiations between the United States and China got under way in London. The Dow Jones Industrial Average rose 23.3 points, or 0.1pc, at the opening bell to 42,786.19. The S&P 500 rose 4.3 points, or 0.1pc, to 6,004.63, while the Nasdaq Composite rose 43.2 points, or 0.2pc, to 19,573.14. US treasury secretary Scott Bessent was pictured arriving for the trade talks with China at Lancaster House in London. China and the United States have begun a new round of trade talks in London, Beijing's state media reported. 'On June 9, local time, Vice Premier He Lifeng... began holding the first meeting of the China-US trade consultation mechanism with the American side in London,' state news agency Xinhua said. Government borrowing costs are edging higher ahead of an auction this week of US Treasuries which could indicate how confident investors are in the American economy. The US Treasury will auction $22bn of 30-year bonds on Thursday. Any sign of weak demand could push yields higher – and thus the cost of government borrowing. Treasury yields were flat today, while the 10-year UK gilt yield was last up one basis point to 4.65pc. Oxford Economics analyst John Canavan warned that borrowing costs could also be pushed up in the near future by strong US economic data, which could mean the Federal Reserve will delay cuts to interest rates. Bond yields could also rise over concerns about President Trump's 'one big beautiful bill' of tax cuts working its way through Congress, as well as from 'increased uncertainty in the face of President Trump's mercurial policy decisions'. Mr Canavan said: 'The 10-year and 30-year Treasury auctions this week could potentially suffer from those factors, whichcould add to the near-term pressure on the long end. 'Slower economic growth and upward pressure on inflation over the next couple of quarters could add fuel to deficit fears, potentially creating a cycle of fiscal concerns increasing higher term premiums, which will increase Treasury rates, raising government funding costs, and increasing fiscal concerns again.' Donald Trump's crackdown on immigration will end the era of strong growth in the US economy, a Wall Street banking giant has warned. The US president's hard line on immigration will cause a 'swing from strength to weakness' in America's ability to attract new entrants to the labour market, analysts at JP Morgan said. Demonstrators protesting against federal immigration raids have clashed with police in Los Angeles since late last week, with President Trump ordering 2,000 members of the National Guard to the California city over the weekend. JP Morgan indicated the tightening of US immigration policy would 'weigh on the expansion' in the economy. Meanwhile, the 'uncertain' outlook for US trade policy would also define what happens in the second half of the year, with the effective tariff rate of nearly 15pc 'only just now taking full effect'. JP Morgan said the economy further faced hit from a decline in federal and local government spending, which is on track to grow at a reduced pace of 1pc, compared to 3.8pc over the last two years. JP Morgan chief economist Bruce Kasman said: 'A less appreciated slowdown in US government spending and tightening in immigration policy are set to weigh on the expansion.' He added: 'These policy shifts are largely a US story and are reflected in our forecast that a period of sustained above-potential US growth is over.' China's meeting with US officials in London comes as Beijing also launches discussions with other trading partners in a bid to build a united front to counter Donald Trump's tariffs. It has held talks with Japan and South Korea, and on Thursday it turned to Canada, with the two sides agreeing to regularise their channels of communication after a period of strained ties. Canadian prime minister Mark Carney and Chinese premier Li Qiang also discussed trade and the fentanyl crisis, Ottawa said. Beijing has also proposed establishing a 'green channel' to ease the export of rare earths to the European Union, and the fast-tracking approval of some export licences. China is expected to host a summit with the EU in July, marking 50 years since Beijing and Brussels established diplomatic ties. US stock index were subdued as investors looked ahead to the trade talks between the United States and China in London. Top officials from both countries will meet after Beijing and Washington accused each other of violating a preliminary agreement struck last month in Geneva that had briefly cooled tensions between the world's largest economies. The second-round of meetings comes four days after Donald Trump and Xi Jinping spoke by phone, their first direct interaction since Trump's January 20 inauguration. The benchmark S&P 500 closed above 6,000 on Friday for the first time since February 21, following a better-than-expected jobs report and a rebound in Tesla's shares. Hopes of more trade deals between the US and its major trading partners, along with upbeat earnings and tame inflation data, helped American stocks rally in May, with the S&P 500 and the tech-heavy Nasdaq notching their best monthly gains since November 2023. The S&P 500 remains a little over 2pc below all-time highs touched in February, while the Nasdaq is about 3pc below its record peaks reached in December. In premarket trading, the S&P 500 and Dow Jones Industrial Average were flat, while the Nasdaq 100 was down 0.1pc. One of Wall Street's biggest banks has pushed back its forecasts for US interest rate cuts this year amid signs the American jobs markets is holding up better than expected. Citigroup said it expects the next US rate cut will happen in September rather than July after the stronger-than-expected May jobs report. Nonfarms payrolls grew by 139,000 in May, similar to the downwardly revised 147,000 in April and better than the 126,000 forecast. As a result, Citi said it expects the US Federal Reserve will only cut rates three times this year, compared to previous predictions of four cuts, in September, October and December. Money markets indicate there will be fewer than two reductions in borrowing costs in 2025. It comes after the Wall Street bank lifted its target for the benchmark S&P 500 stock index to 6,300 by the end of the year, up from 5,800 earlier. The benchmark S&P 500 index closed above 6,000 for the first time since late February on Friday amid a bounceback from Donald Trump's tariff onslaught. The US president has been urging the Fed to cut interest rates to boost the economy. An index tracking emerging market currencies hit a record high ahead of the US-China trade talks in London. The MSCI index of emerging market currencies was up 0.2pc at an all-time high as the dollar continued to weaken. Trading was subdued with several markets, such as Hungary, Romania, and Turkey, closed for public holidays. Meanwhile, a broad index for emerging market stocks jumped about 1pc to hit a more than three-year high. Global markets were pinning their hopes on the talks between representatives from Washington and Beijing in London on Monday, which could potentially improve growth worldwide. Oil prices have steadied after recent strong gains ahead of the latest US-China talks. Brent crude traded 0.2pc higher above $66 a barrel after jumping 4pc last week, while West Texas Intermediate was near $65. Negotiators from the US and China were poised to hold talks in London today, raising hopes that the world's two largest economies can de-escalate their trade war. Crude has retreated by 11pc this year over concerns that the trade tensions could hinder global growth, which could hamper demand for energy. At the same time, the Opec+ cartel of oil-producing nations has been ramping up production at a faster-than-anticipated pace, underpinning fears that there will be a glut of oil in the second half of this year. A semiconductor specialist is set to become the latest British company to quit the London stock market after agreeing to a $2.4bn (£1.8bn) takeover by an American rival. Alphawave IP Group said on Monday it was recommending shareholders to vote for a sale to US chip giant Qualcomm. The deal would mean the company, which only floated on the London Stock Exchange four years ago, would cease to be listed. It is a fresh blow to the City just days after Wise, the British financial technology champion, announced it was moving its main listing to New York. Global markets were mixed as investors waited to see the outcome of trade talks between Washington and Beijing in London. The FTSE 100 was little changed at 8,834.30, while the Cac 40 in Paris lost 0.2pc to 7,792.44 and Germany's Dax edged 0.4pc lower to 24,215.67. The Dow Jones Industrial Average and S&P 500 were flat in premarket trading in New York. However, it was a different story in Asia as teams from the US and China prepared to conduct trade negotiations in London. In South Korea, the Kospi added 1.6pc to 2,855.77 and Chinese markets rose even though the government reported that exports slowed in May. Exports to the United States fell nearly 35pc in May and nearly 10pc in January-May in annual terms. China also reported that consumer prices fell 0.1pc in May from a year earlier, marking the fourth consecutive month of deflation. Hong Kong's Hang Seng picked up 1.6pc to 24,181.43, which was its highest level since March 21, while the Shanghai Composite Index climbed 0.4pc to 3,399.77. Tokyo's Nikkei 225 gained 0.9pc to 38,088.57 as the government reported that the Japanese economy contracted by 0.2pc in the January-March quarter. China wants to deepen its relationship with Britain, its vice premier has said after a meeting with Rachel Reeves. He Lifeng met with the Chancellor in London today ahead of his talks with a US trade delegation in the capital. He called for deeper financial and economic cooperation with Britain, according to China Central Television. The vice premier also urged Britain and China to maintain a stable relationship. Ms Reeves said Britain 'attaches great importance to cooperation with China and is willing to strengthen communication', according to the CCTV report. China inflation dropped last month for the fourth time in a row, official data showed, adding to concerns about the world's second largest economy. The National Bureau of Statistics (NBS) showing the consumer price index dropped 0.1pc in May. The reading, which was slightly better than expected but marks the fourth straight month of falling prices, comes as Beijing struggles to boost domestic consumption that has been sluggish since the end of the pandemic. The failure of leaders to kickstart demand threatens their official growth targets and complicates their ability to shield the economy from President Trump's tariff blitz. While deflation suggests the cost of goods is falling, it poses a threat to the broader economy as consumers tend to postpone purchases under such conditions in the hope of further reductions. The value of the dollar slipped against all major currencies ahead of the pivotal US-China trade talks. The pound was up 0.4pc against the greenback at $1.357 while the euro gained 0.3pc to $1.143. Charu Chanana, chief investment strategist at Saxo Markets, said: 'A deal to keep talking might be better than nothing, but unless we see a concrete breakthrough, the impact on sentiment is likely to remain muted.' The dollar had been lifted on Friday after better than expected US employment figures, which indicated the American economy was doing better than expected. However, the US currency remains down more than 8.6pc against major currencies so far this year. China 'holds the upper hand' in the mining and processing of rare earths, which will be a focal point in the trade talks with the US in London. The materials are crucial for not only cars but also a range of other products from robots to military equipment. The Chinese government started requiring producers to obtain a licence to export seven rare earth elements in April. Resulting shortages sent prompted fears among some car makers that they would have to halt production. President Trump, without mentioning rare earths specifically, took to social media to attack China at the end of last month, accusing it of violating its trade deal made in Geneva. The Chinese government indicated Saturday that it is addressing the concerns, which have come from European companies as well. A Commerce Ministry statement said it had granted some approvals and 'will continue to strengthen the approval of applications that comply with regulations.' The scramble to resolve the rare earth issue shows that China has a strong card to play if it wants to strike back against tariffs or other measures. Richard Hunter, an analyst at Interactive Investor, said: 'Despite the President's previous rhetoric, there seems to be some possibility that some of this aggression will be dialled back, not least of which since China has an upper hand especially with regard to its near monopoly on rare earth minerals which are so vital for components in the high-tech industry. 'China may also be keen on conciliation since there are further signs that its economy is struggling to fend off the tariff pressures so far.' The cost of government borrowing edged lower in Britain ahead of the talks between top US and Chinese trade officials in London. The yield on 10-year UK gilts – a benchmark for the cost of servicing the national debt – declined two basis points to 4.62pc on bond markets. Yields were also lower across the eurozone after the European Central Bank last week cut interest rates by a quarter of a percentage point to 2pc, as expected. Germany's 10-year bund yield was down nearly three basis points to 2.54pc. The FTSE 100 opened slightly higher as the US and China prepare to hold trade talks in London. The UK's blue-chip stock index climbed 0.1pc to 8,845.73 while the mid-cap FTSE 250 was flat at 21,159.10. Donald Trump said the talks in London 'should go very well'. The negotiations come just a few days after the US president and Xi Jinping finally held their first publicly announced telephone talks since the Republican returned to the White House. Trump said the call, which took place on Thursday, had reached a 'very positive conclusion.' Xi was quoted by state-run news agency Xinhua as saying that 'correcting the course of the big ship of Sino-US relations requires us to steer well and set the direction'. The call came after tensions between the world's two biggest economies had soared, with Trump accusing Beijing of violating a tariff de-escalation deal reached in Geneva in mid-May. Mr Trump's press secretary, Karoline Leavitt, told Fox News on Sunday: 'We want China and the United States to continue moving forward with the agreement that was struck in Geneva.' China's export growth slowed to a three-month low in May as US tariffs hit shipments. Total exports from the world's second largest economy expanded by 4.8pc year-on-year last month, down from 8.1pc in April and below analyst expectations of 5pc, according to customs data. China's exports to the US plunged by 34.5pc in the sharpest drop since the outbreak of the Covid pandemic in February 2020. Imports dropped 3.4pc, deepening sharply from the 0.2pc decline in April, despite the trade deal agreed between Beijing and Washington in Geneva at the start of last month. Zichun Huang of Capital Economics said: 'The slowdown in export growth in May should partially reverse this month, as it reflects the drop in US orders before the trade truce, which took time to feed through to actual shipments. 'But with tariffs likely to remain elevated and Chinese manufacturers facing broader constraints on their ability to sustain rapid gains in global market share, we think export growth will slow further by year-end.' Top US and Chinese officials will sit down in London today for talks aimed at defusing the high-stakes trade dispute between the two superpowers. Their trade war has deepened in recent weeks beyond tit-for-tat tariffs to export controls over goods and components critical to global supply chains. At a still-undisclosed venue in London, the two sides will try to get back on track with a preliminary agreement struck last month in Geneva. The US delegation will be led by treasury secretary Scott Bessent, commerce secretary Howard Lutnick and US trade representative Jamieson Greer. The Chinese contingent will be helmed by vice premier He Lifeng. A UK Government spokesman said: 'The next round of trade talks between the US and China will be held in the UK on Monday. 'We are a nation that champions free trade and have always been clear that a trade war is in nobody's interests, so we welcome these talks.' Investors in Europe appear more sceptical about the prospects of the US-China trade talks kicking off in London today. The FTSE 100, France's Cac 40 and Germany's Dax are all on track to open flat when trading gets underway later. Kathleen Brooks, research director at XTB, said: 'Asian stocks are rallying at the start of the week; however, European equity futures and US futures are taking a breather and are pointing to a slightly lower open later today.' She added: 'Stocks may need a new driver to extend last week's rally after investors scaled back their expectations for Federal Reserve interest rates cuts for this year. There are less than two cuts priced in by the Fed Fund Futures market by the end of this year. 'The number of rate cuts from the Fed could be determined by the outlook for US inflation, which is released later this week. As the growth data remain unaffected by tariffs for now, inflation could hold the key for US monetary policy.' Thanks for joining me. Stock markets jumped in Asia ahead of US-China trade talks due to get under way in Britain today. Shares were up from Hong Kong to Tokyo following a call late last week between US president Donald Trump and Chinese leader Xi Jinping. Representatives from the world's two largest economies are due to meet at a still undisclosed location in London in an attempt to revive a preliminary trade agreement reached in Geneva last month. The US delegation will be led by treasury secretary Scott Bessent, commerce secretary Howard Lutnick and US trade representative Jamieson Greer. The Chinese contingent will be helmed by vice premier He Lifeng. Relations soured earlier this month after President Trump accused China of violating the terms of the deal. Beijing accused Washington of doing the same. 1) Ukraine plots fracking revolution | Ukraine is working to unleash natural gas fracking with the goal of becoming a major exporter and revolutionising Europe's energy market 2) John Lewis to slim down staff committee to accelerate decisions | Retail giant to cut size of partnership council to 43 in bid to boost turnaround 3) British manufacturing is dying before our eyes | Labour needs to take bold action to lower energy costs in this week's industrial strategy 4) How £7 pints are destroying Britain's pubs | Rising costs are forcing beleaguered publicans to raise prices, driving cash-strapped customers away 5) Lawyer who acted for Gerry Adams to pursue chatbots for libel | The high-profile media lawyer who represented Gerry Adams in his libel trial against the BBC is now preparing to sue the world's most powerful AI chatbots for defamation. Shares rose in Asia ahead of the second round of trade talks between Washington and Beijing, due later today in London. In South Korea, the Kospi added 1.9pc to 2,865.52. Chinese markets rose even though the government reported that exports slowed in May, growing 4.8pc from a year earlier after a jump of more than 8pc in April. Exports to the United States fell nearly 10pc compared with a year earlier. China also reported that consumer prices fell 0.1pc in May from a year earlier, marking the fourth consecutive month of deflation. Hong Kong's Hang Seng picked up 1.4pc to 24,119.64 while the Shanghai Composite Index climbed 0.4pc to 3,397.13. Tokyo's Nikkei 225 gained 1.1pc to 38,137.09 as the government reported that the Japanese economy contracted by 0.2pc in the January-March quarter. Australia's market was closed for a public holiday. On Friday, stocks gained ground on Wall Street following a better-than-expected report on the US job market. The gains were broad, with every sector in the S&P 500 rising. That solidified a second consecutive winning week for the benchmark index, which has rallied back from a slump two months ago to come within striking distance of its record high. The S&P 500 rose 1pc to 6,000.36. The Dow Jones Industrial Average added 1pc to 42,762.87 while the Nasdaq gained 1.2pc, to 19,529.95. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
