Source: Sharecast
The FTSE 100 rose 0.85% to close at 9,138.37, while the FTSE 250 gained 0.64% to end at 22,155.41.
Sterling weakened against major currencies, falling 0.29% against the dollar to $1.3542, and losing 0.31% to €1.1501 on the euro.
Market sentiment was buoyed by news of a US-Japan trade agreement that included a 15% tariff cap and $550bn in Japanese investment commitments, easing concerns of a broader trade conflict.
Hopes were further lifted by reports that a similar US-EU deal could be imminent.
“The reduction in global trade tensions has calmed investors,” said TickMill’s Patrick Munnelly, noting it had “boosted growth in global markets” and alleviated fears of a prolonged trade war.
UK economic data paints a fragile picture
Despite the market gains, economic data underscored the UK’s fragile growth trajectory.
The flash S&P Global composite PMI fell to 51.0 in July from 52.0 in June, indicating the slowest pace of private sector expansion in two months and below economists’ forecasts.
Services growth weakened notably, while manufacturing output reached a nine-month high.
“The flash UK PMI survey for July shows the economy struggling to expand,” said S&P's Chris Williamson.
He added that output growth is running at a pace consistent with just 0.1% quarterly GDP growth, with risks skewed to the downside.
Employment trends were especially weak, with job shedding accelerating to the fastest rate since February.
“The weak growth trajectory and sustained culling of jobs will add to pressure on the Bank of England to cut rates again at its next policy meeting,” Williamson said.
Separately, consumer sentiment softened in July, with the British Retail Consortium reporting declines in both economic and personal financial outlooks.
“Rising inflation, particularly for food, has put more pressure on personal finances,” said BRC chief executive Helen Dickinson.
In the automotive sector, UK vehicle production fell 11.9% in the first half of the year, according to the SMMT, marking the worst performance since 1953 outside of pandemic-related disruption.
The sector was hit by US tariffs, policy uncertainty, and a collapse in commercial vehicle output.
SMMT boss Mike Hawes called the first half “one of the most turbulent periods in the history of the UK automotive industry,” while expressing cautious optimism after a new trade deal with Washington and the launch of a £650m EV grant scheme.
International data meanwhile offered a mixed backdrop for markets.
In the United States, initial jobless claims fell slightly to 217,000 for the week ended 19 July, suggesting continued labour market resilience despite broader economic uncertainty.
In the eurozone, private sector activity picked up in July, with the composite PMI rising to an 11-month high of 51.0, buoyed by growth in services and a stabilisation in manufacturing.
However, sentiment in Germany deteriorated unexpectedly, with the GfK consumer climate index falling to a four-month low of -21.5 for August.
Analysts attributed the drop to ongoing geopolitical uncertainty and renewed concerns over US tariffs, which weighed on both economic expectations and consumers’ willingness to spend.
Reckitt jumps on upgraded guidance, Pennon in the red
Investor attention was firmly focussed on a flurry of corporate earnings in London.
Reckitt Benckiser surged 9.56% after upgrading its revenue guidance, citing stronger-than-expected sales of core brands like Dettol and Nurofen.
AJ Bell’s Russ Mould said new CEO Kris Licht “has got the market believing in his recovery plan.”
BT Group jumped 10.13% after reaffirming guidance and announcing Patricia Cobian as its new CFO.
Vodafone gained 3.29% as it maintained full-year targets despite ongoing challenges in Germany.
Howden Joinery rose 8.92% on solid half-year results, with Mould noting the company is “still selling plenty of kitchens” despite weak consumer demand.
Airtel Africa rose 6.12% on strong quarterly earnings, while ITV soared 12.77% after highlighting growth in digital advertising and cost discipline.
“ITV is showing it still has a lot to offer,” Mould said, praising its strategy amid the decline in traditional broadcast viewing.
Lloyds Banking Group finished up 1.98% after reporting better-than-expected profits and lifting its dividend, though it kept full-year guidance unchanged.
“This was a ‘steady as she goes’ announcement,” Mould noted, citing improved fee income and the release of prior impairments.
Other risers included IG Group and Wickes, while among the fallers were Pennon Group, down 6.7% after going ex-dividend, Vesuvius, off 5.52% after warning of weak conditions into 2026, and 3i Group and Wizz Air, both lower following earnings updates.
Reporting by Josh White for Sharecast.com.
Market Movers
FTSE 100 (UKX) 9,138.37 0.85%
FTSE 250 (MCX) 22,155.41 0.64%
techMARK (TASX) 5,249.60 0.98%
FTSE 100 - Risers
BT Group (BT.A) 220.20p 10.43%
Reckitt Benckiser Group (RKT) 5,558.00p 9.96%
Airtel Africa (AAF) 196.30p 7.26%
Ashtead Group (AHT) 5,032.00p 3.60%
JD Sports Fashion (JD.) 92.82p 3.59%
Vodafone Group (VOD) 86.02p 3.44%
Diploma (DPLM) 5,265.00p 3.14%
Rentokil Initial (RTO) 375.40p 2.51%
AstraZeneca (AZN) 10,906.00p 2.17%
Relx plc (REL) 3,972.00p 1.98%
FTSE 100 - Fallers
SSE (SSE) 1,851.50p -3.16%
Beazley (BEZ) 889.50p -2.25%
Fresnillo (FRES) 1,439.00p -2.05%
3i Group (III) 4,264.00p -1.84%
BP (BP.) 397.75p -1.68%
Severn Trent (SVT) 2,680.00p -1.36%
United Utilities Group (UU.) 1,124.00p -1.27%
Melrose Industries (MRO) 520.00p -1.25%
London Stock Exchange Group (LSEG) 10,245.00p -1.25%
Glencore (GLEN) 322.75p -1.13%
FTSE 250 - Risers
ITV (ITV) 87.80p 13.29%
Howden Joinery Group (HWDN) 910.00p 8.92%
Oxford Nanopore Technologies (ONT) 202.20p 8.50%
IG Group Holdings (IGG) 1,140.00p 7.65%
Future (FUTR) 767.50p 4.42%
Volution Group (FAN) 656.00p 3.96%
Abrdn (ABDN) 205.60p 3.47%
Genuit Group (GEN) 405.50p 3.44%
Pagegroup (PAGE) 279.80p 3.10%
Wickes Group (WIX) 227.00p 2.95%
FTSE 250 - Fallers
Pennon Group (PNN) 496.80p -6.70%
Vesuvius (VSVS) 364.80p -5.52%
Telecom Plus (TEP) 1,932.00p -2.81%
Bloomsbury Publishing (BMY) 500.00p -2.15%
Oxford Instruments (OXIG) 1,910.00p -2.05%
Hilton Food Group (HFG) 847.00p -1.97%
Sequoia Economic Infrastructure Income Fund Limited (SEQI) 80.40p -1.95%
Foresight Solar Fund Limited (FSFL) 90.30p -1.84%
Discoverie Group (DSCV) 693.00p -1.83%
Fidelity Emerging Markets Limited Ptg NPV (FEML) 832.00p -1.77%
