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European stock sell-off gathers pace as pharma shares slide
The sell-off in European stock markets has gathered pace, and pharmaceutical stocks are among the biggest fallers ahead of Donald Trump’s tariff announcement later today.
The Stoxx 600 healthcare index fell as much as 2.5% to its lowest level since December.
Analysts said US tariffs this time round could focus on the pharmaceutical sector.
Germany’s Bayer and France’s Sanofi dropped by 4.7% and 3.3% respectively. In the UK, AstraZeneca fell by 2.4% and GSK lost 3.3%.
The FTSE 100 index in London has lost 48 points, or 0.55%, to 8,587. Germany’s Dax is trading 1% lower while France’s CAC has lost 0.35% and Italy’s FTSE MiB is 0.77% down.
Gold has risen by around 0.5% is hovering near the record high hit yesterday.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said:
It’s not surprising that pharma stocks have been caught up in this wave of nervousness.
Investors are on tenterhooks as the clock ticks down what’s expected to be the biggest wave of tariffs on US trading partners. It’s been dubbed Liberation day by president Trump, but it’s more like entrapment day, with more countries set to be tangled up in a web of fresh duties.
The internationally focused FTSE 100 is on the back foot in early trade as concerns swirl about the effect on growth prospects for economies around the world. Wall Street made some tentative moves of recovery after the week’s early losses, a trend likely to continue later. But a pattern of one step forward, two steps back has been emerging as hopes for more leniency in trade policy keep being dashed, and the Trump administration seems intent on playing hardball.
Key events
US factory orders rose by 0.6% in February, according to official figures from the Census Bureau.
This was slightly better than the 0.5% rise expected by Wall Street, and came after an upwardly revised 1.8% increase in January.
On Wall Street, the Dow Jones, S&P 500 and Nasdaq indices have dipped by around 0.2%, ahead of the announcement from Donald Trump on new tariffs in a few hours’ time.
Manufacturing orders rose 0.6% in Feb to $594B. Shipments up 0.7%, inventories up 0.1%. Transportation and chemical goods led growth. Unfilled orders grew slightly. Positive momentum continues. #Manufacturing pic.twitter.com/I0sYxcNjLD
— Econoday, Inc. (@Econoday) April 2, 2025
US Factory Orders:
m/m +0.6% (est +0.5%, last +1.8% from +1.7%)
m/m ex Transportation +0.4% (est +0.4%, last +0.3% from +0.2%)Factory orders remain solid, but largely due to a frontloading made in first 2 months to avoid tariffs in my view… pic.twitter.com/xqRfdSRhgd
— Mario Cavaggioni (@CavaggioniMario) April 2, 2025
Tesla quarterly sales slump 13% amid backlash against Elon Musk
Tesla sales declined in the first three months of the year, another sign that Elon Musk’s once high-flying electric car company is struggling to attract buyers.
The drop of 13% is likely due to combination of factors, including its ageing lineup, competition from rivals and a backlash from Musk’s embrace of rightwing politics. It also is a warning that the company’s first-quarter earnings report later this month could disappoint investors.
Tesla reported deliveries of 336,681 vehicles globally in the January-March quarter. Analysts polled by FactSet expected much higher deliveries of 408,000. The figure was down from sales of 387,000 in the same period a year ago. The decline came despite deep discounts, zero financing and other incentives.
US economy adds more jobs than expected, says ADP
The latest US labour market data is out: private employers added 155,000 jobs in March, more than expected, according to a monthly report from ADP Research.
This was stronger than the 120,000 increase forecast by economists, and came after an increase of 84,000 jobs in February, revised higher from 77,000.
Manufacturing delivered stronger-than-average job gains for the second straight month, while hiring in the construction sector slowed. The natural resources and trade, transportation, and utilities industries all shed jobs.
Nela Richardson, ADP’s chief economist, said:
Despite policy uncertainty and downbeat consumers, the bottom line is this: The March topline number was a good one for the economy and employers of all sizes, if not necessarily all sectors.
France says Trump tariffs could be in 20%-25% range, causing ‘major disorder’
France expects new US tariffs on European products to be in the range of 20% to 25%, which would lead to “major economic disorder,” according to a government spokeswoman.
Sophie Primas told reporters:
They risk being pretty powerful. People are speaking of tariffs between 20% and 25%.
This will obviously lead to major economic disorder on the products impacted, not only in Europe but also in the United States.
France’s industry minister Marc Ferracci said earlier today that Europe would respond in a “proportionate manner”.
Irish pharma CEO: ‘People are going to die’ if tariffs drive up costs of life-saving treatments
Ireland’s pharmaceuticals sector also fears the impact of potential new Donald Trump tariffs, which could disrupt supply chains and drive up the cost of medicines worldwide.
There has been a stark warning from an Irish pharma CEO, Gareth Sheridan at Nutriband, about the potential impact of tariffs on pharma, speaking on BBC World Service radio in the last hour:
We make chemotherapy treatments, we make heart medications, we make antibiotics, we make pain medications, we make diabetes medications. These types of treatments can’t afford a disruption in the global supply chain. You know, as a comparable situation, tariffs on automobiles – if you can’t afford a BMW, okay, buy a Ford and you can still get to work.
If you have a 25% hike on chemotherapy and you can’t afford your treatment anymore, what’s the alternative? I mean, ultimately, people are going to die, and they’re going to die because they can’t afford to live.
West Midlands to suffer most from new car tariffs – research
Back to tariffs. Today has been designated as ‘liberation day’ by the Trump administration with a second round of tariffs on international imports to the US expected to be announced. This follows the 25% tariff placed on imported vehicles and automotive parts, which is due to come into effect tomorrow.
These automotive tariffs are estimated to cost the UK £9.8bn in GDP between 2025 and 2030, putting 137,000 jobs at risk, according to new analysis.
The West Midlands – an important hub for carmakers their supply chains – will be hardest hit in the UK by these automotive tariffs, with an estimated loss of £6.2bn in GDP by 2030, according to Dr Matt Lyons and Dr Huanjia Ma, research fellows at City-Region Economic Development Institute (City-REDI), at the University of Birmingham,.
The West Midlands is home to Jaguar Land Rover, Aston Martin, Changan Automotive and a large cluster of suppliers. In a 2023 study 22 of the 50 largest automotive firms in the region were already found to be at risk of insolvency due to poor liquidity ratios.
The West Midlands is projected to suffer the most severe impact. The North West is anticipated to lose £2.1bn in GDP. Together, these two regions will see 85% of the economic impact.
The impact of a decision made an ocean away specifically on the West Midlands cannot be understated. Rather than a shock, the West Midlands automotive sector could face a sudden and catastrophic earthquake.
Here’s our full story on Heathrow airport, following executives’ appearance before MPs.
Airlines warned Heathrow about risks to its power supply days before the airport was shut down by a substation fire, a Commons committee was told.
The Heathrow chief executive, Thomas Woldbye, apologised for the disruption, which affected more than 200,000 passengers on Friday 21 March, but defended the decision to close as he said staying open was potentially “disastrous”.
Speaking to MPs on the Commons transport select committee, Woldbye said that such a power outage had been seen as a “very low probability event” and the airport had paid for a “supposedly resilient” supply.
However, Nigel Wicking, the chief executive of Heathrow Airline Operators’ Committee, representing airlines, said that incidents including cable theft had made him concerned and he had spoken to senior airport officials.
Trump to consider final proposal on TikTok as US ban deadline looms
Donald Trump will consider a “final proposal” over the sale of TikTok’s US operations today, according to reports, as a Saturday deadline looms for the Chinese-controlled app to find a buyer.
The White House is finalising plans for a deal involving US investors, possibly including the tech firm Oracle and the private equity firm Blackstone, CBS News reported.
TikTok’s parent, the Beijing-based ByteDance, has until 5 April to sell the app’s US unit or be banned in the country, under an executive order signed by the US president.
The potential transaction, which is reportedly a “final proposal”, will involve new investors such as Blackstone joining existing non-Chinese shareholders in ByteDance in providing fresh capital to bid for the business, Reuters reported.
The leisure group that owns the 126-year-old Brighton Palace Pier is planning to delist from the London stock market and return to life as a private company, in the latest blow to the capital’s junior market.
Brighton Pier Group, which also owns several bars and mini-golf sites around the country, told investors it intends to cancel its listing on the capital’s Alternative Investment Market (Aim) after more than 11 years, blaming bad weather, falling consumer spending, rising wage costs and higher interest rates.
The news led to shares in the company tumbling by as much as 60% during morning trade on Wednesday.
The group, which is chaired by the business veteran and former Pizza Express and Patisserie Valerie boss Luke Johnson, said it had faced “persistent challenging trading conditions” since the coronavirus pandemic, forcing it to cut costs and sell off underperforming assets.
The Bank of England’s regulatory arm has fined a former non-executive director of the failed Wyelands Bank, which was owned by Sanjeev Gupta, the boss of troubled Liberty Steel, for rule breaches.
The Prudential Regulation Authority has fined George Jay Hambro £72,000 for rule breaches between July 2017 and February 2020.
This comes a week after the accounting firm PwC was fined £2.9m and severely reprimanded by the UK’s accounting regulator for “serious failings” in its audit of Wyelands Bank.
Thames Water appoints ex-Pennon executive Steve Buck as finance chief
Thames Water has appointed the former Pennon and Anglian Water finance chief Steve Buck as chief financial officer, less than a week after its previous CFO abruptly quit.
The previous finance boss Alistair Cochran resigned last Friday, at a critical time for the UK’s largest water company amid close scrutiny of its fragile finances.
Buck, a chartered management accountant, who also spent 11 years working for Centrica in senior roles including group head of finance and transformation and finance director of British Gas, starts his new job at Thames on Monday.
He has previously worked for Thames, between 2002 and 2007.
The company said he has a proven track record working in capital intensive and regulated industries; and has demonstrated success in modernising finance functions, leading M&A activities and managing capital markets.
Chris Weston, Thames’s chief executive, said:
I am delighted that Steve is joining Thames at a pivotal moment for the business. He will play a crucial role as we seek to place Thames on a more secure financial foundation, continue to implement our turnaround plan and focus on a full recapitalisation of the business.
Buck said he was looking forward to returning to Thames Water.
Working with the team I will be focused on delivering the company’s turnaround plan, and deliver the recapitalisation of the business, in order to put the business on a firmer financial platform so that we can improve performance and ensure we meet the expectations of our customers, colleagues and wider stakeholders.
Buck will receive an annual salary of £500,000, a pension allowance of 12% of salary, which is aligned to the pension allowance for the workforce, and a car allowance of £12,500 a year.
He will also benefit from Thames’s performance-related pay plan with an on-target performance paying out at 156% of salary. The plan contains an award payable at the end of the performance year, and a deferred award payable after two years.
The company, which is struggling to stave off insolvency as it struggles under a debt pile of close to £20bn, has lurched from one crisis to the next, and has received fines for allowing water leaks and sewage spills into rivers. It has been heavily criticised for paying out executive bonuses and dividends while raising bills for customers.
It said the bonus plan has been “designed to meet Ofwat’s requirements on executive pay, and contains performance measures directly aligned to customer, environment and financial resilience. The deferred element is directly linked to delivery of the turnaround plan”.
Ireland’s unemployment rate has risen slightly from a record low.
The jobless rate rose to 4% in March from a record low of 3.9% in February, according to data from the Central Statistics Office.
That rate matched the previous all-time low recorded between October 2000 and April 2001 in the early days of the country’s Celtic Tiger boom.
Trump’s tariffs ‘will be negative the world over,’ says Lagarde
Donald Trump’s latest planned tariffs will have a negative impact around the world but their precise impact depends on how far they go, how long they last and whether trade deals can be negotiated, European Central Bank president Christine Lagarde reiterated today.
She told Ireland’s Newstalk radio:
It will be negative the world over and the density and the durability of the impact will vary depending on the scope, on the products targeted, on how long it lasts, on whether or not there are negotiations.
Because let’s not forget, quite often those escalations of tariffs, because they prove harmful, even for those who inflict it, lead to negotiation tables where people actually sit down and discuss and eventually remove some of those barriers.