The FTSE 100 closed up 14.40 points at 10,508.61.
Market opening at London Stock Exchange. Stocks posted modest gains on Wednesday after better-than-hoped inflation data, and as investors eye interest rate decisions in the US and UK.
The FTSE 250 ended up 38.15 points, 0.2%, at 23,364.73, while the AIM All-Share firmed 3.90 points, 0.5%, to 807.83. The oil price steadied after two days of heavy falls ahead of the start of US-Iran peace talks on Friday and the interest rate decision from the Federal Reserve. Oil prices had tumbled in recent days as optimism grew there would be a lasting Middle East peace agreement, but investors took a breather on Wednesday and crude edged up modestly.
Brent crude for August delivery traded higher at 80.11 dollars a barrel on Wednesday, up from 79.95 dollars at the time of the equities close in London on Tuesday. In European equity markets on Wednesday, the CAC 40 in Paris ended down 0.2%, and the DAX 40 in Frankfurt edged 0.1% higher. In New York, the Dow Jones Industrial Average was up 0.4%, the S&P 500 was little changed, and the Nasdaq Composite eased 0.1%.
After the European market close, the US Federal Reserve is expected to leave interest rates unchanged, with all eyes on Kevin Warsh as he chairs his first Federal Open Market Committee meeting. Kathleen Brooks, research director at XTB, said this is a “tricky time” for a new Fed chair to set policy, and thinks Mr Warsh’s “messaging and how he frames his views on the economy and the future of monetary policy will be closely scrutinised”.
Mr Warsh has stated his preference for less Fed communication, so “how he deals with the media this week is crucial for market sentiment. It will also give us a clearer idea of how the Fed could operate under Warsh”, Ms Brooks added. Thursday sees the Bank of England’s rate call where the central bank is also expected to leave interest rates unchanged.
“Dovish data, lack of explicit guidance on June, drop in energy prices and patient approach is likely to mean a hold,” analysts at Bank of America said. Supporting this, data from the Office for National Statistics showed Consumer Prices Inflation held at 2.8% in May, unchanged from April and below the FXStreet-cited consensus for a rise to 3.0%.
Core inflation, which excludes energy, food, alcohol and tobacco, accelerated slightly to 2.6% from 2.5%, though this was also below expectations for 2.7%.
“There are still minimal signs of indirect effects from the energy price shock, which adds to our conviction that the BoE will be on hold this year,” analysts at Barclays said. Against the euro, sterling ebbed to 1.1554 euros from 1.1567 euros on Tuesday. The euro traded lower against the greenback, at 1.1591 dollars on Wednesday against 1.1603 dollars on Tuesday. The yield on the US 10-year Treasury eased to 4.43% on Wednesday from 4.45% on Tuesday.
Gold traded at 4,356.32 dollars an ounce on Wednesday, higher from 4,323.46 dollars on Tuesday. The inflation figures, which boosted hopes that UK interest rates will not be raised in the near-term, supported housebuilders, with Berkeley Group up 1.9%, Barratt Redrow up 2.7% and Persimmon up 3.8%. Barclays climbed 3.4% as Bank of America raised its share price target to 600p from 570p and reiterated a “buy” rating.
“We think recent developments in the operating environment, namely higher swap rates, strong UK lending growth, active capital markets, particularly in the US, and strong consumer trends in the US, should benefit Barclays given its business mix. This not only presents upside potential to earnings, but the higher capital generation could also support higher buybacks,” BofA said in a research note.
Weir Group rose 2.7% as it was awarded a “significant” pumps order from Lloyds Metals and Energy which it said shows the “strength of our technology”. The order, secured in the first quarter of 2026, is part of the second phase of Lloyds Metals’ slurry pipeline project at its Surjagarh mine in Maharashtra, India. Weir also supplied pumps for the first phase of the project – a 100-kilometre pipeline with a capacity of 10 million tonnes per year.
Elsewhere, Smiths News rose 9.8% after securing a long-term distribution agreement with News UK, publisher of The Sun and The Times newspapers. The contract extends the partnership through July 2037 and expands Smiths News’ territories, making it the exclusive national distributor of News UK’s titles across Great Britain from July 2027.
The biggest risers on the FTSE 100 were Endeavour Mining, up 211p at 4,434p, Persimmon, up 40.5p at 1,119p, Barclays, up 16.55p at 503.5p, Weir Group, up 66p at 2,502p and Barratt Redrow, up 6.8p at 261.9p. The biggest fallers on the FTSE 100 were Entain, down 27.6p at 567.4p, Halma, down 146p at 3,874p, Marks & Spencer, down 12.6p at 359.6p, J Sainsbury, down 8.1p at 301.4p and Burberry, down 30p at 1,127.5p. Thursday’s global economic calendar has interest rate decisions in the UK and Switzerland, unemployment figures in the UK and PPI data in Canada. Thursday’s local corporate calendar has trading statements from food retailer Tesco and Premier Inn owner Whitbread.
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