FTSE 100 reached the highest of all time because of the trade agreement hoping to lift the global market

Wednesday 23 July 2025 18:50

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FTSE 100 closed at the highest of all time on Wednesday in the hope that the United States and Japanese trade agreement would trigger a busy schedule of a similar pact between the Trump government and the largest trading partner in America.

The London Blue-Chip Index closed up 0.5 percent to reach the highest record of 9080 points, in the latest and most obvious marks of the revival of British shares more than 2025.

Footsie now rises more than 10 percent this year, and passes 9,000 points for the first time in its history last week. Analysts have associated their stars with a historical low -lower judgment combination that captivated investors hunting values and defensive index constituents into beneficiaries of geopolitical uncertainty that had disrupted the global economy this year.

Similar general meetings occurred in most of the main index, when risk-on sentiment sweeping the financial markets at an agreement announced by the US and Japan to minimize the tariffs charged on Japanese goods entering America.

Japan was chosen by Donald Trump as overseeing one of the most terrible trade imbalances with the United States when the President announced what was called the reciprocal rate regime in April.

The US initially planned to make Asian countries have a 24 percent tariff on all goods exported to America. But the agreement announced by Trump and Japanese Prime Minister Shigeru Ishiba brought the accusation down to 14 percent before the deadline set by Trump.

In return, Japan agreed to invest $ 550 billion (£ 407 billion) directly into the US economy, in a Trump agreement labels “the biggest trade agreement in history”.

‘Good Vibes’ on FTSE 100

The Japanese Nikkei rose sharply on the news, closing more than 3.5 percent for fear that the worst Trump tariff regime had been differentiated by the agreement. The car maker is the largest breeding in all the country’s blue-chip index, with shares in Toyota jumping more than 14 percent.

The index rally triggered a similar movement on the largest exchange in Europe, because the Japanese agreement triggered the hope that European Parliament members might attack the same pact as the US. In addition to the profit of FTSE 100, CAC 40 Paris rose 1.4 percent during that day, while DAX Germany rose 0.8 percent.

Laith Khalaf, Head of Investment Analysis at AJ Bell said the As-Japan agreement brought “some good vibrations to the market”.

“The long -term effect of the tariff must still be seen but for now, the market seems happy to entertain the home run and ignore mistakes,” he said.

The Financial Times reported that after the European market was closed on Tuesday that the European Union almost agreed to the same agreement with Japan, which would see block tariffs on exports to America down to 15 percent.

But Deutsche Bank warns that traders may still be less leading to the prospects of the tariff that suddenly blabbering throughout the global economy when Trump’s deadline for negotiations passed on August 1.

Jim Reid, a market strategist at German loan giver, said the threat of higher trade levies “remains for several major economies” including Brazil and Canada.

“There is also a higher sectoral rate promise, including 50 percent on copper, so this is still far from the end, and each tariff will have a significant impact if they enter,” he said.