The FTSE 100 (^FTSE) and European stocks were higher on Thursday as investors were optimistic that a trade deal between the EU and the US would be reached.

According to diplomats, the EU is on course to strike a deal resulting in a 15% tariff on exports to the US. The rate would mirror the framework agreement the US struck with Japan, officials said in a brief to EU envoys on the talks.

Under the outlines of the potential deal, the 15% rate could apply to sectors including cars and pharmaceuticals and would not be added to longstanding US duties, which average just under 5%, Reuters reported.

It is believe there could also be concessions for sectors such as aircraft and lumber, as well as some medicines and agricultural products, which would not face tariffs.

Meanwhile, traders are also focused on the European Central Bank (ECB), which is expected to announce that it will keep interest rates on hold later today. The hold would pause seven straight cuts as it awaits confirmation on Europe’s trade relations with the United States.

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London’s benchmark index (^FTSE) was 0.5% higher in early trade, marking a sixth straight session of gains.

Germany’s DAX (^GDAXI) rose 0.9% and the CAC (^FCHI) in Paris headed 0.3% into the green.

The pan-European STOXX 600 (^STOXX) was up 0.5% to its highest since 11 June.

Wall Street is set for a mixed start as S&P 500 futures (ES=F) and Dow futures (YM=F) were in the red and Nasdaq futures (NQ=F) advanced.

The pound was 0.2% down against the US dollar (GBPUSD=X) at 1.3561.

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FTSE risers and fallers Here are the FTSE 100 risers and fallers this morning:

ECB set to hold interest rates European Central Bank (ECB) is expected to keep interest rates on hold later today. The hold will pause seven straight cuts as it awaits confirmation on Europe’s trade relations with the United States. It comes as the ECB has already halved its policy rate from a record 4% to 2% in the space of just one year, with inflation in the eurozone now back at its 2% target.

Traders hopeful EU and US will reach trade deal Investors were optimistic on Thursday that a trade deal between the EU and the US would be reached. According to diplomats, the European Union is on course to strike a deal resulting in a 15% tariff on exports to the US. The rate would mirror the framework agreement the United States struck with Japan, officials said in a brief to EU envoys on the talks. Under the outlines of the potential deal, the 15% rate could apply to sectors including cars and pharmaceuticals and would not be added to long-standing US duties, which average just under 5%, Reuters reported. It is believe there could also be concessions for sectors like aircraft and lumber as well as some medicines and agricultural products, which would not face tariffs.

Lloyds increases dividend as profits jump by 5% Lloyds (LLOY.L) reported a higher-than-expected pre-tax profit of £3.5bn for the first half of 2025, a 5% jump as as the lender benefited from an increase in lending and savings balances. Underlying profits for the first half of the year rose 2% to £3.56bn. Lloyds intends to pay an interim dividend of 1.22p, equivalent to £731m, representing a rise of 15% on a year ago. Profits were helped by a smaller-than-expected impairment charge for bad loans. City analysts had forecast a £591m provision, but the actual impairment was £442m, although this was still up from £101m at the same point in 2024. Underlying profit for the trimester rose by 32% year on year to £2bn, earnings per share landed at 2.1 pence, and the cost-to-income ratio stood at 52.2%. Return on tangible equity rose 2.9 percentage points from the previous quarter to 15.5%. For the first six months of 2025, the lender’s net income added 6% to £8.9bn, and earnings per share stood at 3.8 pence, up from 3.4 pence reported a year earlier. The UK’s biggest mortgage lender maintained its performance targets for the year, as improved house price expectations helped offset a decline in its economic outlook including higher unemployment expectations. Lloyds said total customer lending increased by £11.9bn over the period, or 3%, driven by UK mortgages, with some 33,000 first-time buyers borrowing on a home. Customer deposits also grew by £11.2bn, or 2%, following a strong season for ISAs, while more people moved money out of current accounts and into savings. Read the full article here

Asia and US overnight Asian shares rose overnight amid optimism that the US-Japan tariff agreement will be followed by more trade deals. Traders are speculating that the US may soon reach a trade agreement with the European Union, after the Trump administration struck deals with Japan, the Philippines and Indonesia earlier this week. The Nikkei (^N225) rose 1.6% on the day in Japan, while the Hang Seng (^HSI) climbed 0.4% in Hong Kong. The Shanghai Composite (000001.SS) was 0.7% up by the end of the session. In South Korea, the Kospi (^KS11) added 0.2% on the day after central bank data showed that the country’s economy expanded at a 0.6% annual rate in the last quarter, above expectations thanks to robust private consumption and exports. Across the pond, the S&P 500 (^GSPC) rose 0.8% to 6,358.97, and the tech-heavy Nasdaq (^IXIC) was 0.6% higher, closing at 21,020.02. The Dow Jones (^DJI) also gained 1.1% on the day to 45,010.29. It came as European leaders were meeting with top Chinese officials in Beijing to discuss trade, climate change and global conflicts. In the bond market, the yield on benchmark 10-year US Treasury notes rose to 4.388% from 4.372% late on Tuesday.

Coming up Good morning, and welcome back to our markets live blog. As usual we will be taking a deep dive into what’s moving markets and happening across the global economy. To the day ahead, the main highlight will be the ECB’s latest policy decision, along with President Lagarde’s subsequent press conference. Otherwise, data releases include the July flash PMIs from the US and Europe, the US weekly initial jobless claims, and new home sales for June. Earnings releases include Intel. Here’s a snapshot of what’s on the agenda: 7am: Trading updates: BT Group, Vodafone Group, Centrica, Reach, Lloyds Banking Group, ITV, Reckitt Benckiser Group, RELX Group 8:30am : Germany HCOB manufacturing purchasing managers’ index flash reading 9am : Eurozone HCOB services PMI flash, manufacturing PMI flash 9:30am : UK S&P Global services PMI flash, manufacturing PMI flash 1:15pm : European Central Bank interest rate decision 1:45pm : European Central Bank press conference 3:00pm: US New Homes Sales

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