Trump tariffs live: FTSE sinks in market chaos as EU says it is ready to retaliate against US

Asked if it was the blunt truth that he could not protect the British people from Donald Trump’s economic measures, Starmer said: “There are undoubtedly challenges, nobody welcomes tariffs but we don’t want to get into a trade war.”

He added the government would continue to talk to US while keeping options on table.

“At a moment like this, we have to shape our future – we have to step up,” he said.

He also said it was important for the UK to have “discussions with others about lowering trade barriers for free trade across the world”.

Wall Street is sinking again, as worries deepen about whether Mr Trump’s trade war will torpedo the global economy.

The S&P 500 was down 3.8 per cent in early trading on Monday, coming off its worst week since Covid-19 began crashing the global economy in March 2020.

The Dow Jones Industrial Average was down 1,200 points, and the Nasdaq composite was 4 per cent lower.

A barrel of benchmark US crude oil briefly dropped below 60 dollars for the first time since 2021.

Political correspondent Archie Mitchell writes:

A conveyer belt of finished Range Rovers is rolling on behind the prime minister as he delivers a speech in response to Donald Trump’s tariffs.And, days after Jaguar Land Rover suspended its US exports, many of the cars have their steering wheels on the left – suggesting they could have been US-bound.

It is a visceral reminder for those in the audience of the devastating impact Mr Trump’s global trade war is already having.

Prime minister Sir Keir Starmer called for the UK to “rise together as a nation” in response to global instability as he acknowledged the challenges posed by Donald Trump’s tariffs.

Speaking at a Jaguar Land Rover plant in the West Midlands, Sir Keir said: “These are challenging times, but we have chosen to come here because we are going to back you to the hilt.”

He said the visit was a “statement of intent”, showing the Government’s support.

The prime minister said: This is a moment for cool heads, nobody wins from a trade war, you know that.

“But it’s also a moment for urgency, because we’ve got to rise together as a nation to the great challenge of our age – and it is the great challenge – which is to renew Britain so we’re secure in this era of global instability.”

Sir Keir Starmer has explained the changes the government is making to rules around automotive sales.

The prime minister announced sales of new hybrids that cannot be plugged in will be permitted to continue until 2035.

Changes to the zero emission vehicle (Zev) mandate also mean it will be easier for manufacturers which do not meet EV sales targets to avoid fines.

“We’re going to help car companies in Britain reach targets that support growth,” he told automotive workers on Monday.

“This is the moment we back British business and charge up the electric revolution.

This comes after US President Donald Trump imposed a 25% tariffs on car imports.

Sir Keir Starmer has promised the UK will only strike a deal with the US if it is in the national interest, as “intense” discussions continue.

Speaking from the West Midlands today, the UK prime minister said: “Of course, we wil keep calm and fight for the best deal with the US and we’ve been discussing that intensely over the last few days.”

But he added: “I will only strike a deal if it’s in the national interest.”

Political correspondent Archie Mitchell writes:

Speculation has been rife that Sir Keir Starmer’s declaration of the dawn of a “new era” of trade and economics meant the government’s fiscal rules were in line for a change.

Germany tweaked its own borrowing limits in response to rising global insecurity in the wake of Donald Trump’s return to the White House.

But despite talk of, and hopes that, Rachel Reeves might follow suit in the wake of the US president’s trade war, she backed the existing rules on Monday.

Ms Reeves said increasing uncertainty “means doubling down on economic stability, the basic condition to secure economic growth”.

She added: “It is why this government has stuck to its fiscal rules in the spring statement, even when they were tested, demonstrating that when Britain talks about economic stability, we really mean it, and stability matters even more for working people and for business in an uncertain world.”

Business and money editor Karl Matchett writes:

As expected, there’s an initial sell-off beyond the futures markets as retail investors and others get involved in the selling. The S&P 500 is down about 3.4 per cent after opening, with the Dow and Nasdaq down 3.7 and 4.3 per cent respectively.

“This domino effect of potential higher prices, weakened demand, reduced production, and potential job cuts, has sent a shockwave through global markets. The uncertainty surrounding the scope and duration of the tariffs, combined with elevated equity valuations after two years of double-digit returns, has fueled a wave of panic selling,” says Dan Segal of Warwick Business School.

“In just a few days, both the FTSE 100 and the S&P 500 have declined by roughly 10 per cent, reflecting investor concerns that the worst may still lie ahead.

“Still, the most critical advice in times like these is this: Don’t panic. History shows that equity markets are highly volatile during periods of economic and geopolitical uncertainty; however, they tend to rebound once the dust settles. This may be a moment of turbulence but not necessarily of collapse.”

Starmer has re-asserted his support for the automotive industry as he addresses workers at Jaguar-Land Rover.

“These are challenging times but we have chosen to come here because we are going to back you to the hilt,” he said.

“There is no doubt the challenge but this is a moment for cool heads. Nobody wins from a trade war.”

“Its also a moment for urgency because we’ve got to rise together as a nation.”

He added: “This moment has also made something very clear that this is not a passing phase and just as we’ve seen with national security and defence … and now with our commerce and trade, this is a changing and completely new world.

“An era where old assumptions simply don’t apply any longer.”

Sir Keir Starmer has warned “global economic consequences could be profound” as the world grapples with Donald Trump’s sweeping tariffs.

Speaking from the West Midlands today, the UK prime minister said: “That is a great challenge for our future and the global economic consequences could be profound.”