British Equities Rebound as Private Sector Expansion Picks Up
London shares rallied on Thursday, with the FTSE 100 closing 0.70% higher, as investors welcomed the fastest growth in Britain's private sector output in four months during August.The seasonally adjusted S&P Global UK PMI Composite Output Index rose to 52.5 in August, as initially estimated, from 52.2 in the previous month. In the final report, the expansion was attributed to an acceleration in services output growth, while manufacturing production increased at the slowest pace in four months."Service providers are increasingly optimistic about the year ahead business outlook, with confidence levels now close to those seen just prior to the Middle East conflict. However, business activity growth projections were still subdued in comparison to long-run trends amid lingering worries about inflationary pressures and geopolitical tensions," S&P Global Market Intelligence Economics Director Tim Moore said.In corporate news, British investment manager M&G (MNG.L) was up 1.46% as it swung to a loss attributable to equity holders for the six months ended June 30 of 170 million pounds sterling from an attributable profit of 243 million pounds a year ago."Net income, however, was a big miss to consensus at GBP-165m vs GBP172mE, after GBP325m Ground Rent impact, GBP120m from equity hedges, and an increase in restructuring costs from GBP37m to GBP60m y/y (vs RBCe GBP35m)," RBC Capital Markets said. "For FY26, M&G now guides to a 'low double-digit' [adjusted operating profit] yoy growth (vs FY25 flat, and +15% in H1); with FY26 company compiled consensus already at +11% (RBCe: 12%), we see limited room for FY26 upgrades post today's release."Meanwhile, Jet2 (JET2.L), up 3.91%, is targeting the transfer of its entire share capital to the main market of the London stock exchange from the AIM segment before the end of its current financial year. The leisure travel company also booked a 7.6% yearly increase in summer 2026 seat capacity to 19.9 million seats.Hilton Food Group's (HFG.L) stock surged 12.12% after the food company raised its full-year expectations for adjusted profit before tax from continuing operations to between 66 million pounds and 71 million pounds, from the previous range of 60 million pounds to 65 million pounds.On the geopolitical front, US Secretary of State Marco Rubio stated that actions against Iran will persist to stop threats to global shipping lanes. Meanwhile, President Donald Trump said he does not expect the renewed military operations against Iran to stretch on for a long time.
