Forget the tariff tantrums. The FTSE 100 just booked its best month in four.
Despite a flurry of drama from across the pond, yes, we’re talking about Trump’s latest Truth Social tirade, London’s markets wrapped up May on a high note.
On Friday, May 30 FTSE 100 rose 0.6%, FTSE 250 inched up 0.1%, and both indices capped off their strongest monthly performance in nearly a year.
Trump’s Tariff Rant Shakes Markets, But Not for Long
Just when you thought things were settling, Donald Trump reignited tariff fears, accusing China of violating their agreement:
“China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr. NICE GUY!” — Trump, via Truth Social
This shot sent a brief chill through markets, trimming earlier gains. But savvy investors shrugged it off, with most betting that the worst of the trade war noise is just that—noise.
Why? Because earlier this week, a U.S. court blocked most of Trump’s tariffs, only for an appeals court to temporarily reinstate them. The whole saga has been, well, chaotic. But markets are reading between the lines: volatility is temporary, momentum is real.
Resilience Amid Global Whiplash
Despite the tariff headwinds, British equities have remained strikingly resilient, and there are three big reasons why:
Bank of England policymaker Alan Taylor dismissed inflation fears and even pushed for a deeper rate cut, following May’s modest 25-basis-point move.
This means monetary easing is back on the table, and that’s bullish for equities.
New surveys show British public inflation expectations dropped to 4% in May, down from 4.2%. That gives the BoE more cover to cut rates further, and gives investors more confidence in a soft landing.
Earlier this month, Washington and London struck a limited bilateral trade agreement, soothing fears of broader trade conflict. That helped counterbalance Trump’s more fiery rhetoric.
M&G Steals the Spotlight with a 5.5% Surge
M&G (MNG.L) was Friday, May 30th’s breakout performer on the stock-specific front, rallying 5.5% to top the FTSE 100.
Why? Japanese insurance giant Dai-ichi Life Holdings announced plans to scoop up a 15% stake in the UK-based insurer and asset manager. It’s a strong vote of confidence, and investors rewarded it big time.
Beyond London
Global stocks are wrapping up their best month since late 2023. U.S. consumer spending cooled slightly in April, rising just 2.1% YoY compared to 2.3% in March—but inflation ticked up moderately, keeping rate cut hopes alive.
Meanwhile, the U.S. dollar is flirting with its first monthly gain of 2025. Investors are juggling interest rate outlooks, political risk, and surprise court rulings. It’s a lot, but for now, the risk-on mood is winning.
