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Axel Rudolph, senior technical analyst at online trading platform IG, said:

The Bank of England is to delay its decision on interest rates on Thursday because of the two-minute silence to mark the 80th anniversary of VE Day.

Britain’s central bank said it will publish the announcement at 12.02pm rather than the usual time of noon, with its quarterly economic forecasts and minutes of the decision also due to be published two minutes later.

It will mark a rare divergence for the Bank from its traditional noon announcement, which is watched closely by savers, borrowers and financial markets in the UK and worldwide.

The Bank last postponed an interest rates decision in 2022, when it was put back by a week due to the national mourning period following the Queen’s death.

Conservative leader Friedrich Merz has prevailed in a vote in parliament to become Germany's chancellor.

The new premier faced two rounds of votes after unexpectedly falling six votes short of the majority he needed the first time round.

In German parliament representatives vote in secret, so there's no indication which politicians weren't backing him the first time.

BBC News reported a prevailing mood of confusion in the parliament in the hours after the vote.

The Bank of England (BoE) is expected to cut UK interest rates by a quarter-point to 4.25% this week and signal further reductions amid growing concerns over the impact of US president Donald Trump’s global trade war on UK jobs and growth.

BoE governor Andrew Bailey has signalled that policymakers anticipate tariffs to hit UK economic activity, a key factor in their upcoming rate decision. This will mark the first time Threadneedle Street has formally assessed how Trump's trade policies might affect inflation and the outlook for UK interest rates.

Economists have warned that the ongoing trade tensions could lead to a significant slowdown in global trade, driving up prices and increasing the risk of a US recession — all of which would weigh on the UK's economic growth.

Read more on Yahoo Finance UK

The UK and India have sealed a free trade agreement, in a deal which is hoped will boost sectors hardest hit by Donald Trump’s tariffs.

The deal, announced on Tuesday afternoon, will mean dramatic tariff reductions on scotch whisky and car exports to India, while levies on aerospace, electricals and other food products will also fall.

Prime Minister Keir Starmer said: “We are now in a new era for trade and the economy. That means going further and faster to strengthen the UK’s economy, putting more money in working people’s pockets.”

He added: “Today we have agreed a landmark deal with India – one of the fastest growing economies in the world, which will grow the economy and deliver for British people and business.”

Indian prime minister Narendra Modi described it as a “historic milestone” and an “ambitious and mutually beneficial” trade agreement that will “catalyse trade, investment, growth, job creation, and innovation in both our economies”.

“I look forward to welcoming PM Starmer to India soon,” he added.

More than a dozen rounds of talks involving successive governments have taken place since 2022 with the aim of securing a trade pact with India, which is forecast to become the world’s third largest economy.

Key sticking points had included high tariffs on Scotch whisky in India and visa rules for Indian students and professionals.

Business and Trade Secretary Jonathan Reynolds and Indian commerce minister Piyush Goyal held final talks in London last week after relaunching negotiations two months ago.

The deal means the UK will do significantly more business with the fast-growing economy of 1.4bn people.

Here are the major indices:

The Kia Sportage is one of the UK's most popular cars. But where did it rank?

Click on the link to discover UK's best-selling cars

Oil prices rose by more than 2% on Tuesday, recovering some of the losses from the previous session, when a decision by OPEC+ to accelerate production hikes sent prices tumbling.

Brent crude futures were up 2.7%, to trade at $61.85 a barrel, while West Texas Intermediate climbed 2.7%, hitting $58.71 a barrel.

Both benchmarks had settled at their lowest levels since February 2021 on Monday, as OPEC+ moved forward with plans to further accelerate oil production hikes for the second consecutive month.

“Today’s slight rebound in oil prices appears more technical than fundamental,” said Yeap Jun Rong, a market strategist at IG. “Persistent headwinds including a pivotal shift in OPEC+ production strategy, uncertain demand amid US tariff risks, and price forecast downgrades are continuing to weigh on the broader price movement.”

Barclays revised its Brent crude forecast on Monday, cutting its 2025 estimate by $4 to $70 per barrel and lowering its 2026 estimate to $62 per barrel. The bank cited a "rocky road ahead for fundamentals”, pointing to growing trade tensions and OPEC+’s shift in its production strategy as key factors influencing the outlook.

Goldman Sachs also adjusted its price forecast on Monday, lowering its outlook by $2 to $3 per barrel. The investment bank now anticipates an additional 400,000 barrels per day increase in OPEC+ production in July, further contributing to market uncertainty.

Read more on Yahoo Finance UK

Yahoo Finance UK's Vicky McKeever writes:

Carmaker Ford (F) warned in its first quarter results, released on Monday, that it expected to take a $1.5bn hit to operating profits this year due to US president Donald Trump's tariffs.

Ford also withdrew its financial guidance for the year, citing tariff-related uncertainty.

In the first quarter, revenue of $40.7bn was down 5% on the same period last year, but was still ahead of forecasts of $38.02bn, according to estimates of analysts surveyed by FactSet.

Net income fell to $471m in the first quarter, down from $1.3bn last year.

Ford (F) CEO Jim Farley said in an earnings call with analysts on Monday that it was "too early to gauge the related market dynamics [from tariffs], including the potential industrywide supply chain disruptions."

"Automakers with the largest US footprint will have a big advantage, and, boy, that is that true for Ford," he said. "It puts us in the pole position."

The latest UK services PMI has shown the first dip in business activity since October 2023, ending a 17-month expansion.

This largely reflected a renewed downturn in order books, S&P Global said. Export sales were particularly subdued, with total new work from abroad decreasing at the fastest pace since February 2021.

Survey respondents widely commented on risk aversion and delayed spending decisions among clients in response to rising global economic uncertainty.

New business intakes decreased for the third time in the past four months during April. Service providers typically cited weaker business investment and client confidence in the wake of US tariffs announcements and subsequent financial market turmoil.

Yahoo Finance UK's Pedro Goncalves writes:

Gold (GC=F) prices rose to a two-week high on Tuesday as renewed fears over US president Donald Trump's tariff plans boosted interest in the safe-haven metal.

Gold futures gained 1.6% to $3,377.40 per ounce at the time of writing, while the spot price rose 3% to $3,376.14 an ounce.

“We are seeing a continued flow of safe-haven demand, keeping gold prices elevated. Prices are going to trade above $3,000 level at least in the near-term,” Jim Wyckoff, senior analyst at Kitco Metals, told Reuters.

The rally in gold prices follows Trump’s announcement on Sunday of a 100% tariff on foreign films, a move that raised eyebrows and stoked fears of broader trade tensions.

The announcement, combined with Trump’s comments that no talks with China are planned for the coming week, has heightened concerns about the economic fallout from a potential global trade conflict.

The US president, however, suggested that he is open to reducing tariffs "at some point", leaving the door slightly open for future negotiations.

Market watchers are also closely eyeing the US Federal Reserve's upcoming interest rate decision and comments from Fed chair Jerome Powell on Wednesday, with investors looking for clues on the central bank’s monetary policy path.

Goldman Sachs (GS) analysts have predicted that the Fed will hold off on cuts for the time being but will likely announce three 25 basis point reductions in the coming months, in July, September, and October.

"Fed officials will want to see evidence from labour market and other hard data before cutting. We think this will take a couple of months and therefore expect three 25bp cuts in July, September, and October," the investment bank said in a note.

Gold, which provides a safeguard against political and financial instability, tends to thrive in low-interest-rate environments, further boosting its appeal as a safe-haven asset amid rising uncertainty.

Traders in London are playing catch up today to the news that Shell (SHEL.L) is reportedly looking closely at a BP (BP.L) acquisition.

According to a report by Bloomberg, citing people familiar with the matter, the considerations are only in their early stages. Any successful bid would capitalise on BP's ailing share price which has dropped more than 30% since this time last year.

For several years, BP and Shell were almost equal in size, but over the past few years Shell has grown to almost twice the size of BP.

“As we have said many times before, we are sharply focused on capturing the value in Shell through continuing to focus on performance, discipline and simplification,” a spokesperson for Shell told Bloomberg in an emailed statement.

A representative for BP declined to comment.

Palantir (PLTR) stock is currently 9.3% lower in premarket trade following its first-quarter earnings report. The dip comes despite the fact it beat its Q1 guidance and boosted its full-year guidance.

The AI software company posted earnings of 13 cents-a-share adjusted vs. the 13 cents expected. Its revenue was $884m, higher than the $863m expected.

“We believe our results are indicative of a revolution sweeping across our business and industry,” CEO Alex Karp said in a letter to shareholders.

Even with the dip, the company's stock price is up more than 55% for the year-to-date.

Food delivery stalwart Deliveroo (ROO.L) has accepted an offer by US rival DoorDash (DASH), in a takeover deal valuing the business at £2.9bn.

DoorDash is paying 180p-per-share, a 44% premium on its first public offer, reported last month.

The merged company will have local presence in more than 40 countries.

"The combination with Deliveroo will strengthen DoorDash's position as a leading global platform in local commerce," the two firms said in a statement.

Deliveroo shares were 2.1% higher in early trade in London.

Naeem Aslam, CIO at Zaye Capital Markets, said:

US stock futures slipped after President Trump's latest remarks dimmed hopes of tariff relief, adding to Wall Street's sense of uncertainty ahead of the Federal Reserve's next policy decision.

Futures attached to the Dow Jones Industrial Average (YM=F) slipped 0.2% and the benchmark S&P 500 (ES=F) traded 0.4% down. Futures attached to the tech-heavy Nasdaq Composite (NQ=F) sunk 0.6%.

On Monday, stocks retreated from a historic run of gains that saw the S&P 500 mark its longest winning streak in 20 years. Two comments by Trump drove the shift in sentiment. First, he said he plans to impose a 100% tariff on movies produced outside of the US. Second, he indicated he has no plans to talk trade with China's President Xi Jinping this week.

After the bell, tariffs loomed large in Ford's (F) strong earnings report too, and shares fell. The automaker pulled its 2025 guidance, citing trade uncertainties, and said it foresees a $1.5 billion hit from the president's auto duties.

Read more on Yahoo Finance

Hello again. We're back with the finance and markets news of the day.

Today traders will be watching a slew of financial reports from listed companies. That includes:

• Axa (CS.PA)

• Ferrari (RACE.MI)

• Philips (PHIA.AS)

• Super Micro Computer (SMCI)

• Electronic Arts (EA)

Also coming up: UK and EU PMI reports and UK car sales data from the SMMT.

Let's get to it.