Bunzl’s market value reduced substantially after it issued warnings regarding its poor North American operational performance, combined with macroeconomic uncertainty due to Donald Trump’s tariff policies.

A Challenging Start to the Year

The first quarter of 2025 presented “a challenging trading environment” according to Bunzl’s chief executive Frank van Zanten. The FTSE 100 company lowered its revenue growth prediction from strong to moderate by the end of the year after its initial robust growth expectations. Operating margins will experience pressure pushing them below 8% which reflects a decrease from the previous year's 8.3%.

Bunzl responded to current difficulties by announcing their intention to enhance operational performance specifically within their North American sector which generates the highest revenue. The company will suspend its share buyback programme until the end of 2025 after spending £115m on repurchases earlier this year.

Impact of Trump’s Trade Policies

Bunzl's share decline demonstrates how Donald Trump’s international trade strategies are causing increasing widespread effects. The uncertainty from tariffs has damaged investor trust in multiple industries including manufacturing and logistics sectors and staffing.

The current update contributes to broader problems caused by the intensification of the trade conflict. The US government imposed restrictions that prevent Nvidia from selling AI chips to China alongside an investigation into potential tariffs on critical mineral imports which further unsettled markets.

Market-wide Woes

The business pressure Bunzl faces is not unique to them. The FTSE 250 recruiter Hays announced a 9% decrease in their Q1 net fees which confirms earlier signals from competitor firms Robert Walters and PageGroup about difficult hiring markets because of trade challenges. Shares of Hays dropped 1% as investors worldwide exhibited increased caution.

Economic disturbances extended beyond the UK borders. European stock markets experienced declines with the FTSE 100 decreasing by 0.5% while Germany’s Dax and France’s Cac showed losses of 0.3% and 0.4% respectively. Asian markets experienced declines as Hong Kong, Taiwan, and South Korea saw losses between 1.2% and 2%.

Outlook Ahead

Bunzl and the broader market must handle the uncertainty brought about by changing trade policies. Van Zanten has pledged “decisive action” to stabilise North American performance while Bunzl faces extensive uncertainty in upcoming financial periods.

The market downturn reveals escalating global economic conflicts driven by Trump’s tariff actions while showing the extent of financial strain these regulations create for UK-listed companies dependent on foreign markets. The capacity of Bunzl and similar entities to adjust successfully in the face of this unstable environment remains unknown.