Summary:

• U.K. economy grew by 0.5% in Feb, beating expectations
• FTSE 100 gain 42 points to 7,945

Investing.com -- British stocks maintained their gains on Friday's close, ending a volatile week triggered by the trade war, as China raised import tariffs on the U.S to 125% in retaliation to President Donald Trump's recent tariff hike.

The new tariff — the latest escalation in the ongoing trade war between the two countries — marks an increase from the 84% announced earlier this week by Beijing. It will take effect on Saturday.

As of 1530 GMT, the FTSE 100 index rose by 0.6%, while the midcap index FTSE Mid-Cap 250 gained 0.05%. The British pound rose 0.7% against the dollar to 1.3.

The top gainers in the region include Fresnillo PLC (LON: FRES ) and Endeavour Mining PLC, while St. James's Place PLC (LON: SJP ) and BP PLC (LON: BP ) were among the bottom performers.

However, following the tariff announcement, European stocks reversed course, erasing earlier gains. DAX index in Germany fell 1.3%, the CAC 40 in France was down 0.3%.

In other news, the U.K. economy grew 0.5% in February, according to data released by the Office for National Statistics (ONS) on Friday, February’s growth was broad-based, with gains across both the services and manufacturing sectors. Economists had expected a modest 0.1% rise in February.

This followed a 0.1% contraction in January, driven largely by weakness in the production industry.

Analysts at Capital Economics noted that February’s stronger-than-expected growth was encouraging, but cautioned that the outlook remains uncertain. They pointed to upcoming business tax increases in April and broader economic headwinds as factors that could weigh on future performance.

The firm also highlighted that the economy has expanded in just four of the past nine months, suggesting limited momentum ahead.

In Europe, German inflation eased to 2.3% in March, according to the Federal Statistics Office, confirming preliminary data.

In company news, BP PLC (NYSE: BP ) shares fell 3% on Friday after it indicated a decrease in reported upstream production for the first quarter of 2025 compared to the previous quarter, with a slight increase in oil production and a decline in gas and low carbon energy.

The oil and gas company attributed the lower gas segment output in part to divestments in Egypt and Trinidad.

After the update, UBS analysts downgraded the company's shares to Neutral from Buy.