FTSE 100

UK Shares Rally as Central Bank Maintains Policy Status Quo; United Utilities Plans Investment

London's FTSE 100 closed 1.62% higher on Thursday after the Bank of England kept its benchmark rate unchanged at 3.75%, in line with expectations."We think this is a reasonable place given the situation of the economy and the unpredictability of events in the Middle East. We'll continue to monitor the situation and its impact on the UK economy very closely. Whatever happens, our job is to make sure that inflation gets back to the 2% target after the initial impact of the war on energy prices has passed," BoE Governor Andrew Bailey said.In other economic news, Britain's total vehicle manufacturing dropped 8.2% year over year to 72,511 units in March, the Society of Motor Manufacturers and Traders said. Car production declined 0.8% to 69,755 units, while commercial vehicle output plunged 68.3% to 2,756 units."Car production stabilising in March is welcome news for both assembly and the wider supply chain," SMMT Chief Executive Mike Hawes said. "Government's recent intervention to bring down electricity costs will provide a major and long-called for boost, but the scheme's benefits must be delivered urgently as the geopolitical situation offers little optimism."On the corporate side, United Utilities Group (UU.L), up 11.05%, led the blue-chip index after submitting an incremental investment program of 1.4 billion pounds sterling for the UK's North West region to the Water Services Regulation Authority, or Ofwat. To fund the equity portion of the broader 2.5 billion-pound investment program, the utility launched an equity placing of 800 million pounds.Rolls-Royce Holdings (RR.L) surged 7.59% after confirming its underlying operating profit guidance of 4 billion pounds sterling to 4.2 billion pounds for 2026. "We remain strongly positioned to deliver our mid-term targets, with substantial growth beyond the mid-term from both our existing and new businesses," Chief Executive Tufan Erginbilgic said.By contrast, Weir Group (WEIR.L), down 3.98%, was one of the index's worst performers after announcing the departure of Chief Executive Officer Jon Stanton, effective Aug. 1. The engineering group appointed Andrew Neilson, president of the minerals division, as CEO-designate.

Bank of England Leaves Key Rate Unchanged but Soaring Energy Prices Signal Policy Rethink

The Bank of England held its key rate steady at 3.75% and reiterated its readiness to act as the ongoing war in the Middle East pushes up energy costs and creates upside risks for inflation.The UK central bank's Monetary Policy Committee voted 8-1 in favor of a hold, with lone dissenter Chief Economist Huw Pill voting for a 25 basis-point increase to 4%, citing the "clear upward shift in risks" to achieving the BoE's 2% inflation target, according to a Thursday release. At its previous meeting in March, the committee voted unanimously to leave the bank rate unchanged.Based on the latest data from the Office for National Statistics, the country's annual inflation rate climbed to 3.3% in March from the previous month's 3%, with the core rate, which excludes energy prices, edging down to 3.1% from 3.2%.The BoE expects inflation to come in higher later in 2026 on the back of soaring energy prices, with "material" second-round effects posing a risk in price- and wage-setting. Specifically, the headline inflation rate is currently expected by BoE staff to decline to an average of 3.1% in the second quarter before picking up to 3.3% in the third quarter.Given the high uncertainty around global energy prices and the potential impact on domestic inflation, the BoE set out three scenarios to determine how the war could affect the UK economy. In the worst-case Scenario C, the bank rate increases to 5.25% by the first quarter of 2027 on expectations that inflation would peak at 6.2% and remains largely above target."If the shock appears to be short-lived or the economy weaker, policy should place relatively more weight on avoiding unnecessary contraction in activity. If second-round effects are likely to be greater, policy should focus on returning inflation back to target more quickly," BoE Governor Andrew Bailey said.The MPC said it will closely monitor the situation in the Middle East and that it stands ready to implement the necessary measures to ensure that inflation remains on course to meet the BoE's 2% target over the medium term.

Bank of England Holds Key Rate Steady at 3.75% in April Meeting

The Bank of England on Thursday maintained its key rate at 3.75% amid higher energy prices arising from the ongoing conflict in the Middle East.The decision is in line with the consensus estimate for the month.The BoE's Monetary Policy Committee voted 8-1 in favor of a hold, with one member voting for a 25 basis-point increase to 4%. The MPC said it will closely monitor the situation in the Middle East, noting the high uncertainty around global energy prices and the risk it poses to domestic inflation.Based on the latest government data, the UK's annual inflation rate climbed to 3.3% in March from the previous month's 3%, with the core rate edging down to 3.1% from 3.2%. Looking ahead, BoE staff currently expect the headline inflation rate to decline to an average of 3.1% in the second quarter before picking up to 3.3% in the third quarter.

Bank of England Holds Key Rate Steady at 3.75% in April Meeting

SMMT: UK's Total Vehicle Production Falls 8.2% in March

Britain's total vehicle manufacturing dropped 8.2% year over year to 72,511 units in March, the Society of Motor Manufacturers and Traders said Thursday.Car production declined 0.8% to 69,755 units, while commercial vehicle output plunged 68.3% to 2,756 units.In the 12 months to March, total vehicle manufacturing decreased 13% to 208,088 units.

UK Shares Fall as Earnings Pour In, Geopolitical Tensions Rise

British shares retreated on Wednesday, with the FTSE 100 closing 1.16% lower, as investors weighed corporate earnings and geopolitical developments, including reports of US preparations for a prolonged naval blockade in the Strait of Hormuz.GSK (GSK.L), down 5.42%, was the second-worst performer on the blue-chip index. The drugmaker confirmed its 2026 growth guidance and logged a rise in first-quarter attributable profit to 1.74 billion pounds sterling from 1.62 billion pounds a year ago, in line with the FactSet-compiled consensus estimate."GSK has made a strong start to 2026, with good performance from our key growth drivers. Alongside operational delivery, we are focused on execution and accelerating R&D," Chief Executive Officer Luke Miels said.Haleon (HLN.L) also upheld its 2026 growth outlook while first-quarter revenue inched up year over year to 2.86 billion pounds from 2.85 billion pounds amid a weak cold and flu season. The consumer healthcare company's shares were down 3.08% in the closing trade."Q1 top-line growth performance came in line with expectations, albeit a volume decline was softer-than-expected (versus Visible Alpha consensus). Consistent with Reckitt, a weak cold & flu season affected its performance across regions while consumption in Europe remained soft and growth in [Latin America] slowed," RBC Capital Markets said.Meanwhile, energy distributor DCC (DCC.L) confirmed it received indicative cash proposals from a consortium comprising US investment companies Energy Capital Partners and KKR, sending its shares 9.29% higher. The consortium has until June 10 to make a firm offer for the group.On the regulatory front, British communications services watchdog Ofcom launched an inquiry into BT Group (BT-A.L) for potentially failing to comply with its requirements tied to information requests issued to its entities. The regulator said the move does not imply any findings at this stage and that it will review the available evidence before deciding whether enforcement action is warranted. The company's shares lost 1.16% at close.

British Equities Rise as Earnings Season Kicks Off; BP Posts Bumper Profit

London's FTSE 100 closed 0.11% higher on Tuesday as investors examined the first batch of first-quarter earnings from corporate heavyweights.Oil major BP (BP.L) gained 1.12% after profit attributable to shareholders for the three months ended March 31 surged year over year to $3.84 billion from $687 million, thanks to higher margins and oil trading contribution."BP reported strong numbers this morning, with a 20% beat vs. market expectations at the net income level (7% ahead of RBCe)," RBC Capital Markets said. "Looking divisionally, the star of the show was the downstream, with BP reporting higher refining & trading numbers, well in excess of consensus and ~$200m ahead of our estimates for the quarter, supported by exceptional oil trading results."Coca-Cola Europacific Partners (CCEP.L) rose 1.89% after reporting fiscal first-quarter revenue of 5 billion euros, up from 4.69 billion euros a year earlier. The bottling company also reaffirmed its fiscal 2026 guidance, projecting revenue growth of 3% to 4% and operating profit growth of 7%."Whilst the consumer environment remains challenging and the full impact of the situation in the Middle East is uncertain, we are resilient," Coca-Cola Europacific Partners Chief Executive Officer Damian Gammell said.On the economic front, the UK's shop price inflation edged down to 1% year over year in April from 1.2% in March, the British Retail Consortium said. The consensus estimate for the month was 1.5%. BRC Chief Executive Helen Dickinson attributed the increase to discounts offered by retailers on certain Easter goods to encourage spending."Increased fuel prices are already leading to higher inflation, and we can expect a similar impact in the food and non-food supply chains in the months to come," said consumer intelligence firm NIQ's head of retailer and business insight, Mike Watkins. "However, retailers will look to hold back any price increases as long as possible as alongside fragile consumer confidence, accelerating inflation is likely to negatively affect consumer spending."

BRC: UK Shop Price Inflation Down to 1% in April

The UK's shop price inflation edged down to 1% year over year in April from 1.2% in March, the British Retail Consortium said Tuesday.The consensus estimate for the month was 1.5%.BRC Chief Executive Helen Dickinson attributed the increase to discounts offered by retailers on certain Easter goods to encourage spending.

UK Shares End Lower Ahead of Central Bank Decisions, Earnings

British equities closed in the red on Monday, with the FTSE 100 down 0.56%, as investors remained cautious ahead of upcoming corporate earnings and key central bank rate decisions, including from the Bank of England."Even if recent data has come in quite solid, the UK labour market is much cooler and the starting point for the Bank Rate at 3.75% is much higher compared to 2022. Hiking rates will have to be weighed against a considerable risk of exacerbating a looming economic contraction. We think it is most likely the BoE will remain sidelined for the foreseeable future," Danske Bank said.Meanwhile, the Confederation of British Industry distributive trades survey's retail sales balance fell to -68% in April from -52% in March. The consensus estimate was -42% for the month, according to Investing.com."With the economic impact of the Iran conflict becoming clearer, firms will be looking to government to recognise that easing cost of living pressures depends on tackling the cost of doing business. For the distribution sector, that means securing appropriate landing zones on the Employment Rights Act, delivering meaningful business rates reform, and exploring further how non-energy policy costs can be removed from electricity bills," CBI lead economist Martin Sartorius said.In corporate news, GSK (GSK.L), down 0.20%, had a busy start to the new week. Aside from completing a license agreement for its cholestatic pruritus treatment, linerixibat, with Alfasigma, the British pharmaceutical giant also secured breakthrough therapy and priority medicines designations in the US and Europe, respectively, for its once-monthly investigational liver therapy, efimosfermin.Meanwhile, the Delaware Chancery Court in the US granted the motion to dismiss filed by AnaptysBio against GSK subsidiary Tesaro, with the latter affirming its view that the anticipatory breach claim is entirely without merit.

CBI: UK Retail Sales Balance Drops in April

The Confederation of British Industry distributive trade survey's retail sales balance fell to -68% in April from -52% in March, according to data published Monday.The consensus estimate was -42% for the month, according to Investing.com data.

UK's FTSE 100 Extends Losing Streak; Sainsbury's Shares Up

British stocks extended their losses to a fifth day, with the FTSE 100 down 0.75% on Friday's close, amid fresh tariff threats and continued geopolitical uncertainty arising from the Middle East conflict.US President Donald Trump told The Telegraph that he is looking at "putting a big tariff on the UK" if British Prime Minister Keir Starmer does not drop the digital service tax, which is aimed at Apple, Meta and other major technology companies.On the economic front, the UK's retail sales volumes rose 0.7% on a monthly basis in March, following a revised 0.6% decline in February, according to data from the Office for National Statistics. Annually, retail sales volumes increased 1.7%, against the revised 1.8% gain earlier.In corporate news, Bernstein lowered its price target for J Sainsbury (SBRY.L), d/b/a Sainsbury's, to 3.40 pounds sterling from 3.50 pounds, with the stock rated market-perform, following the British grocery retailer's broadly in-line fiscal 2026 results. The stock closed the trading session 1.29% in the green."The challenge for Sainsbury's is that 6 years into the CEO's tenure, margins have gone backwards over the last few years (c. >-30bps) and could soften further into next year. This is despite a well-defined and well executed strategy to put Food First, playing out in market share gains, grocery volume growth, improved pricing, and improved FCF," the research firm said. "However, this successful commercial turnaround is continuously hampered by Argos, cost pressure, macro weakness & competitive pressures, and does not seem to be able to feed into higher margins or a greater share of the profit pool."Meanwhile, aerospace and defense companies Babcock International Group (BAB.L) and BAE Systems (BA.L) were among the blue-chip index's top fallers, losing 4.60% and 2.86%, respectively, at closing.

BofA: Bank of England to Retain Key Rate in April Meeting; Potential June, July Hikes Ahead

BofA Global Research expects the Bank of England to maintain its key rate at 3.75% at its April 30 monetary policy meeting, with a 7-2 vote in favor of a hold and risks of an 8-1 vote."It is likely to note that upside risks from greater persistence to medium-term inflation have risen, while risks from weaker growth remain. We don't expect the BoE to make strong judgements about whether it is likely to hike or be on extended hold, given uncertainty," analysts said in a Thursday preview note. "But we do expect it to keep the door open to modest hikes if energy prices stay elevated, and say aggressive tightening is unlikely, given labour market/growth concerns. We expect it to rule out near-term cuts."Looking ahead, the research firm forecasts the UK central bank to raise its benchmark rate twice in 2026 in June and July, with risks of just one rate increase, noting that "it's a close call."Three quarterly rate cuts to 3.5% are then expected to follow, beginning from the second quarter of 2027, with risks of 3.25%.

UK's Monthly Retail Sales Rise 0.7% in March

Britain's monthly retail sales edged up 0.7% in March after a revised 0.6% dip in February, according to data from the Office for National Statistics published Friday.Analysts expected zero growth for the month, according to Investing.com data.On a yearly basis, UK retail sales rose 1.7%, against the revised 1.8% increase previously and the expected 1.3% gain.Excluding automotive fuel, retail sales were up 0.2% month over month and up 1.7% annually, following the revised decline of 0.6% and revised 2.7% jump earlier, respectively. The figures compare with the consensus estimates of a 0.2% monthly uptick and a 2% yearly rise.

GfK: UK Consumer Confidence Worsens in April Amid Iran War-driven Price Hikes

Britain's consumer confidence indicator slipped to -25 points in April from -21 points in March, market research company Growth from Knowledge said Thursday.The index saw its largest decline in a year and reached its lowest level since October 2023, with the figure missing the consensus estimate of -24 points.The reading signals growing concerns regarding the economic consequences of the war in the Middle East. GfK noted that widespread pessimism has spread to both personal finance and general economic outlooks, with four of the five measures retreating and the savings index being the only metric climbing.

UK Shares Decline on Continued Geopolitical Tensions, Potential Monetary Policy Tightening

London's FTSE 100 closed 0.19% lower on Thursday as the lack of peace talks between the US and Iran increased the possibility of a protracted conflict and the closure of the Strait of Hormuz, while the latest economic data reignited fears of a tighter monetary policy.Britain's private sector output growth accelerated in April, supported by modest rebounds in manufacturing production and in services activity, flash data from S&P Global showed. The flash UK PMI Composite Output Index hit a two-month high of 52 in April, compared with 50.3 in the previous month and the consensus of 49.8."The UK economy has gathered some renewed momentum in April after the initial impact of the war in the Middle East caused growth to stall in March, but the upturn comes with a catch," S&P Global Market Intelligence Chief Business Economist Chris Williamson said. "The improved rate of expansion is in part a reflection of a short-term boost from a rush to secure purchases ahead of feared price rises and supply shortages linked to the war.""The unexpected rise in the UK PMIs suggests the economy may retain some momentum in Q2, but also that the Bank of England (BoE) may have to raise interest rates to lean against inflation," according to Berenberg. "The rise in the composite output PMI leaves it consistent with growth of 0.2% qoq, above our forecast for unchanged output (0.0%). However, the larger increase in the selling prices balance than in the eurozone coupled with mentions of strong wage pressures points to a higher risk of second-round effects (i.e. pay rises to keep pace with inflation) than we anticipated given the weak labour market backdrop."In corporate news, J Sainsbury (SBRY.L), d/b/a Sainsbury's, posted annual growth in preliminary profit and revenue for fiscal 2026, with a warning that the Middle East conflict will weigh on both its customers and business. The British supermarket chain became one of the FTSE 100's worst performers, with shares down 3.68% at closing."FY25 was broadly in line with profits of GBP1,025m and [free cash flow] beat by +2.5%. Q4 trading was softer in grocery (-30 [basis-point] miss) at +4.5% but [general merchandise] outperformed and beat weak expectations. The problem is the guidance range of GBP975-1,075m which is below current consensus of GBP1,100m and therefore we will see consensus trend downwards," Bernstein said.

UK CBI: Total Order Books Balance Falls in April

Total new orders in the UK manufacturing sector decreased to -38% in April from -27% in March, the Confederation of British Industry's industrial trends survey showed Thursday.Analysts expected the reading to stand at -34%, according to Investing.com.

CBI: British Manufacturers' Sentiment Deteriorates in April

Sentiment among UK manufacturers deteriorated in April, with the index dropping to -65% from -19% in January, the Confederation of British Industry said Thursday.

S&P Global: UK Flash PMI Rises to Two-month High in April

Britain's private sector output growth accelerated in April, supported by modest rebounds in manufacturing production and in services activity, flash data from S&P Global showed Thursday.The flash UK PMI Composite Output Index hit a two-month high of 52 in April, compared with 50.3 in the previous month and the consensus of 49.8.Meanwhile, the manufacturing PMI rose to a 47-month high of 53.6 from the prior 51 and the Investing.com analyst consensus of 50.3. On the services side, the PMI came in at a two-month high of 52, against the previous 50.5 and the market forecast of 50.

UK Public Sector Net Borrowing Decreases in March

Public sector net borrowing in the UK, excluding public sector banks, stood at 12.61 billion pounds sterling in March 2026, 1.4 billion pounds less than in the prior-year period.The latest figure marked the lowest March reading since 2022, not adjusted for inflation, according to data from the Office for National Statistics published Thursday. A month earlier, the reading was a revised surplus of 12.82 billion pounds.Analysts expected a surplus of 10.4 billion pounds for the month.

FTSE 100 Falls Amid Ceasefire Extension; UK Inflation Rate Rises

London's FTSE 100 was downbeat on Wednesday, closing 0.21% lower, after the US extended its ceasefire with Iran, while the UK inflation matched expectations in March."In the Middle East conflict, Trump extended the ceasefire indefinitely just before its expiry after Iran refused further negotiations due to unreasonable US demands. This marks a U-turn in tone, as Trump had earlier ruled out an extension and hinted at military action. With Iran reportedly not requesting the ceasefire and the Strait of Hormuz issue still unresolved, Iran appears to hold the upper hand at present," Danske Bank said.In economic news back home, Britain's annual inflation rate climbed to 3.3% in March from 3% in February, according to data from the Office for National Statistics. The latest reading aligned with the consensus estimate."Surging petrol prices explained all of the rise in CPI inflation from 3.0% yoy in February to 3.3% yoy in March, as forecasters expected," Berenberg said. "Away from energy prices inflation behaved well, as shown by the unexpected drop in the core inflation rate from 3.2% yoy to 3.1% yoy (Bloomberg consensus 3.2%). We doubt that CPI inflation will stay above 3% for much longer. Although petrol prices rose further in April, the resulting upward pressure on the headline rate should be more than offset by government intervention and helpful base effects."In corporate news, distribution and outsourcing group Bunzl (BNZL.L) gained 2.12% to become one of the biggest gainers on the blue-chip index after affirming its 2026 revenue guidance while logging a 1.5% revenue growth at constant exchange rates for the first quarter."Reassurance from BNZL's Q1 update with the FY26 outlook reaffirmed and ongoing confidence in the prospect for an M&A pick up in FY26, which is key to the BNZL investment case in our view," RBC Capital Markets said. "We envisage a small outperformance vs. the sector today."Consumer goods giant Reckitt Benckiser (RKT.L), down 4.60%, was the FTSE 100's second-worst performer after group net revenue for the first quarter declined year over year to 3.25 billion pounds sterling from 3.68 billion pounds."Core Reckitt drove a miss on Q1 growth performance, with the biggest miss coming from Emerging Markets," RBC said in another note. "Despite the softer-than-expected performance and the current uncertainty arising from the war in the Middle East, the company has maintained its FY26 Core Reckitt [like-for-like] growth guidance (+4-5%) as the company expect to benefit from the reset of the cold & flu season and continue strong performance in Emerging Markets."