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The costs of FTSE 100 shares are falling as traders digest contemporary commerce tariff threats from the US. After I final checked, the UK’s premier share index was final 0.5% decrease in start-of-week buying and selling.
The intensifying tug-of-war over Greenland took a brand new flip over the weekend. US President Trump threatened to slap tariffs of 10% on a number of European international locations (together with the UK) that oppose his deliberate takeover of the territory. These will are available in on 1 February, and rise to 25% in June, he stated.
Tariff uncertainty rocked international inventory markets in 2025. But it didn’t cease the FTSE 100 rising greater than 20% over the course of the 12 months. And 2026 could possibly be one other blowout 12 months even when commerce tensions intensify.
Nonetheless, it’d pay for traders to contemplate defending themselves from any market volatility. On this regard, Fresnillo (LSE:FRES) and SSE (LSE:SSE) could possibly be prime shares to take a detailed have a look at.
Right here’s why.
Main the index
Gold shares are usually the best beneficiaries of geopolitical and macroeconomic upheaval. With the Greenland saga, now we have each.
And so Fresnillo shares are at the moment the FTSE index’s greatest riser at this time (19 January). Up 4.3%, they’ve been pushed by each gold and silver costs touching new peaks.
Shopping for gold shares doesn’t assure a constructive return when metallic costs enhance. Operational points on the exploration, mine improvement and manufacturing phases — which aren’t unusual — can see these corporations sink in worth.
However with seven working mines and plenty of early-stage property Fresnillo’s monumental scale considerably reduces this menace. If one venture encounters issues the impression on share worth and dividends could be negligible.
Moreover, the comnpany’s scale allows it to raised capitalise on the dear metals surge than most different producers. It’s the world’s largest silver producer, and Mexico’s main gold digger by quantity.
At £39.04 per share, Fresnillo’s share worth trades on a ahead price-to-earnings development (PEG) ratio of 0.5. At under 1, this implies the miner nonetheless presents super worth at this time.
One other FTSE 100 riser
Electrical energy producers like SSE are different traditional secure havens in unsure occasions. Vitality demand stays broadly unchanged throughout the financial cycle, together with when tariff tensions explode.
Reflecting these defensive qualities, SSE’s share worth touched contemporary file peaks this morning.
It’s true that investing in renewable power shares comes with added hazard for traders in contrast with different power producers. Energy output (and by extension earnings) are very a lot on the mercy of Mom Nature.
Nonetheless, SSE’s massive asset portfolio — together with its fleet of gas-fired crops — can considerably scale back the impression of localised points. On steadiness I see the corporate’s concentrate on inexperienced power as a internet constructive for development, given the UK’s ultra-supportive renewables coverage.
And SSE might obtain an added enhance if commerce tariffs encourage the Financial institution of England to chop charges more durable. Decrease rates of interest are beneficial for the FTSE 100 agency’s asset values. In addition they assist scale back borrowing prices.
