European equity markets moved lower on Friday, with UK stocks pressured by growing political uncertainty surrounding the governing Labour Party, while investors also assessed the outcome of high-level talks between the United States and China in Beijing.
The FTSE 100 fell 0.61%, while Germany’s DAX declined 0.79% and France’s CAC 40 lost 0.57%. Sterling weakened for a fourth consecutive session, with GBP/USD down 0.28% to 1.3372 as of 07:25 GMT.
Labour Tensions Add Pressure to Sterling
Political concerns intensified after a Labour MP resigned his seat, potentially opening a route back into Parliament for Andy Burnham and triggering renewed speculation over the future leadership of Prime Minister Keir Starmer.
Market participants view Burnham as favouring a more expansionary fiscal approach, though analysts noted that any potential by-election could present a significant challenge from Reform UK.
Trump Ends Beijing Visit With Positive Signals on Trade and Iran
Meanwhile, Donald Trump departed Beijing on Friday following a two-day state visit that combined formal ceremonies with extensive diplomatic discussions. A military band and flag-waving crowds marked his departure as Air Force One left the Chinese capital.
Trump described the visit as delivering “fantastic trade deals” and said he and Xi Jinping had found common ground on Iran-related issues. Both leaders called for the Strait of Hormuz to remain open and agreed that Tehran should not obtain nuclear weapons.
China’s foreign ministry said the talks produced “a series of new common understandings” and outlined a shared commitment to maintaining stable bilateral relations in the years ahead. Xi is now expected to make a return visit to Washington around September 24.
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