30th Jul 2025 16:56
(Alliance News) - The FTSE 100 struggled for direction on Wednesday, despite progress elsewhere, as investors digested another earnings deluge and looked ahead to the US rate call and earnings from technology titans Meta Platforms and Microsoft.
The FTSE 100 index closed up just 0.62 of a point at 9,136.94. The FTSE 250 closed 16.49 points lower, 0.1%, at 21,776.58, and the AIM All-Share closed down 3.03 points, 0.4%, at 762.72.
The Cboe UK 100 ended down 0.1% at 912.22, the Cboe UK 250 fell 0.1% to 19,101.84, and the Cboe Small Companies closed down 1.4% at 17,439.90.
In Europe on Wednesday, the CAC 40 in Paris rose 0.2%, as did the DAX 40 in Frankfurt.
In New York on Wednesday, the Dow Jones Industrial Average was down 0.1%, the S&P 500 was 0.1% higher, and the Nasdaq Composite rose 0.3%.
The US Federal Reserve will announce its interest rate decision at 1900 BST.
According to the CME FedWatch Tool, it is near-certain that the Fed maintains rates at the 4.25%-4.50% range this week. The Fed held in each of the first four meetings this year. Its last cut was in December, a 25 basis points trim to the federal funds rate range.
A fifth successive hold is in the offing during the final meeting before a summer break.
The US rate call will be swiftly followed by earnings from two of the Magnificent 7 after the closing bell on Wall Street - Microsoft and Meta Platforms.
"Coming hot off the heels of strong TSMC and Alphabet earnings, traders will be watching closely for capex spending habits and chip demand figures to highlight the continuation of the AI story. Nonetheless, for Meta and Microsoft, their performance will once again come down to the hum drum areas of advertising and cloud revenues," said Joshua Mahoney, analyst at Rostro.
Ahead of this investors weighed data showed the US economy registered stronger than expected growth in the second quarter of the year.
According to the Bureau of Labor Statistics, the US economy expanded 3.0% quarter-on-quarter on an annualised basis in the three months to June. The reading topped an FXStreet cited forecast of a 2.4% rise and follows a first quarter which saw the US economy shrink 0.5%.
"The increase in real GDP in the second quarter primarily reflected a decrease in imports, which are a subtraction in the calculation of GDP, and an increase in consumer spending. These movements were partly offset by decreases in investment and exports," the BEA said.
But TD Economics said the figures "overstated" the degree of strength in the US economy.
"An unwinding of Q1's tariff front-running resulted in imports contracting by the largest amount (outside of the pandemic) since the height of the global financial crisis, resulting in a massive positive contribution to GDP. Once the effects of net trade, inventories and government were removed, sales to private domestic purchasers, expanded by just 1.2% or its slowest rate of growth in 2.5 years," it noted.
Nonetheless, US President Donald Trump stepped up pressure for an interest rate cut, citing the rosier economic growth figures.
"'Too Late' MUST NOW LOWER THE RATE," Trump said on his Truth Social platform, using his critical nickname for Fed Chair Jerome Powell.
The pound eased to USD1.3285 late on Wednesday afternoon in London, compared to USD1.3337 at the equities close on Tuesday. The euro traded at USD1.1479, lower against USD1.1537. Against the yen, the dollar was trading higher at JPY148.94 compared to JPY148.38.
The yield on the US 10-year Treasury was at 4.37%, stretched from 4.35%. The yield on the US 30-year Treasury was at 4.91%, widened from 4.88%.
In London, the results season continued in full swing with results from more FTSE heavyweights hitting the wires.
GSK climbed 4.8% as it forecast annual sales growth at the top end of its outlook range, after "another quarter of excellent performance" saw revenue and profit beat forecasts.
The London-based pharmaceutical firm said its portfolio of Specialty Medicines led the way, and the group added that it is "positioned to respond to the potential financial impact of tariffs".
Revenue in the second quarter of 2025 rose 1.3% to GBP7.99 billion from GBP7.88 billion, helping to push pretax profit up 26% to GBP1.89 billion from GBP1.50 billion. Core operating profit rose 12% at constant currency to GBP2.63 billion from GBP2.51 billion.
Company-compiled consensus looked for revenue of GBP7.80 billion and operating profit of GBP2.47 billion.
But HSBC slumped 5.0% as it said pretax profit fell 27% to USD15.81 billion in the six months ended June 30 from USD21.56 billion a year earlier. Diluted earnings per share fell to USD0.65 from USD0.88.
HSBC maintained its interim dividend at USD0.10 per share, but announced plans to initiate and complete a USD3 billion share buyback before its third quarter results are released.
Housebuilder Taylor Wimpey shed 6.0% after revealing a GBP222 million increase in its cladding fire safety provision, a move RBC Capital Markets said caused several investors "we spoke to this morning to choke on their cornflakes."
Elsewhere, International Personal Finance said it would be minded to accept a takeover bid from a suitor of around GBP500 million, should an offer come.
The provider of credit products and insurance services confirmed it was in "advanced" talks with asset-based financing provider BasePoint Capital.
A price per share of 223.8 pence has been mooted, a sum IPF would recommend to shareholders should an official bid materialise, IPF said in a statement.
Shares in IPF closed 19% to the good on the news.
Brent oil was quoted higher at USD72.99 a barrel in London on Wednesday, up from USD70.74 late Tuesday. Gold fell to USD3,292.75 an ounce against USD3,327.45.
The biggest risers on the FTSE 100 were GSK, up 65.50 pence at 1,462.50p, Pershing Square Holding, up 130.00p at 4,194.00p, AstraZeneca, up 340.00p at 11,498.00p, Intercontinental Hotels Group, up 172.00p at 8,848.00p and Spirax Group, up 120.00p at 6,315.00p.
The biggest fallers on the FTSE 100 were Taylor Wimpey, down 6.70p at 100.45p, ConvaTec, down 13.40p at 231.00p, HSBC, down 44.00p at 926.00p, Sage Group, down 57.00p at 1,200.50p, and JD Sports Fashion, down 3.16p at 85.90p.
Thursday's local corporate calendar has half-year results from miner Anglo American, tobacco manufacturer BAT, gold miner Endeavour Mining, consumer products firm Haleon, stock exchange operator and data provider London Stock Exchange, aerospace company Rolls-Royce and oil major Shell. Retailer Next is set to update on trading.
The global economic calendar on Thursday sees an interest rate decision in Japan overnight, plus retail sales, industrial production and consumer confidence figures in Japan, and US weekly initial jobless claims and the Chicago PMI.
By Jeremy Cutler, Alliance News reporter
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