A new month marks the beginning of the second half of the year, and the London stock market has strong momentum behind it. The FTSE 100 has delivered its best January-to-June performance since 2021, gaining 7.2% in the first six months—its third-best first-half showing in the past decade.
London stocks have bounced back from the trade war jitters seen in early April, buoyed by Donald Trump’s 90-day suspension of new tariffs, which is set to expire next week. Investor sentiment has also been lifted by the UK’s new trade agreement with the US, which came into effect yesterday.
Danni Hewson, AJ Bell head of financial analysis, says:
“Considering the massive market wobble which followed Donald Trump’s ‘Liberation Day’ speech the fact that the FTSE 100 has turned in its best half-time performance since 2021 is something worth shouting about.
“Big share price falls grabbed headlines at the start of April as many UK investors watched the value of their pensions fall, but despite the geopolitical uncertainty and tariff turmoil London markets have thrived in the second quarter.
The FTSE 100 has been bolstered by strong performances from defence companies, with BAE Systems surging over 60% and Babcock more than doubling in value, as escalating geopolitical tensions drive demand for their services.
Meanwhile, the FTSE 250—comprising smaller UK-listed companies—posted a robust second quarter, rising more than 11% between April and June, according to Reuters.
Global markets have also rebounded from the earlier trade war slump. In the US, the S&P 500 closed June at an all-time high, reflecting renewed investor confidence.
