10th Jun 2026 17:02
(Alliance News) - The FTSE 100 made steady progress on Wednesday, outperforming US and European peers, despite ongoing tension in the Middle East and accelerating US inflation.
The FTSE 100 closed up 27.48 points, 0.3%, at 10,254.81. The FTSE 250 ended up 113.38 points, 0.5%, at 22,951.34, while the AIM All-Share fell 8.43 points, 1.1%, to 772.38.
The Cboe UK 100 ended up 0.1% at 1,018.48, the Cboe UK 250 was 0.3% higher at 19,785.23, and the Cboe Small Companies Index rose 0.2% at 18,604.01.
In European equity markets on Wednesday, the CAC 40 in Paris ended down 0.5%, and the DAX 40 in Frankfurt closed 1.0% lower.
In New York, the Dow Jones Industrial Average was down 1.0%, the S&P 500 was 0.7% lower and the Nasdaq Composite fell 1.1%.
US consumer inflation surged to a fresh three-year high in May, sparked by soaring energy prices, providing another headache for US President Donald Trump as he continues to tackle the war in the Middle East.
The consumer price index rose 4.2% year-on-year, up from April's 3.8% figure, the US Bureau of Labor Statistics said. It was the highest reading since April 2023, according to official data, but in line with analyst expectations.
On-month, energy prices alone were 3.9% higher, picking up speed after a 3.8% hike in April, and following an 11% surge in March.
"The energy index accounted for over 60% of the monthly all items increase," the BLS said.
Excluding food and energy, core annual consumer price inflation accelerated to 2.9% in May from 2.8% in April. The figure was in line with consensus.
On-month, core consumer prices rose 0.2% in May from April, slowing from 0.4% growth seen in April, and shy of the FXStreet-cited consensus, which had pencilled in a climb of 0.3%.
"Today's print, which was roughly in line with forecasts by economists, the markets and likely the Fed, provides little reason to alter views on inflation," Pooja Sriram at Barclays said.
She expects a run "of solid core PCE prints will likely keep the FOMC on the sidelines" and maintains a call for the Federal Reserve to keep interest rates unchanged for the rest of the year.
In Canada, the Bank of Canada left rates on hold as it weighs slowing growth and rising inflation caused by the Middle East war.
The as expected decision leaves Canada's benchmark rate at 2.25%. The BoC had also held in January, March and April this year, with the last quarter point reduction last October.
In reaching its decision, the BoC's Governing Council agreed to look through the war's near-term impact on inflation but said if energy prices stay high, "we will not let their effects become broad-based persistent inflation."
Elsewhere, market sentiment remained wary following fresh US military action against Iran, which followed the downing of a US helicopter near the Strait of Hormuz.
David Morrison at Trade Nation said the "sudden and unwelcome escalation in US/Iranian hostilities comes just after it appeared that tensions were being dialled down to some extent, after Iran and Israel agreed to terms over Lebanon."
More hopefully, AFP reported Qatari negotiators have travelled to Tehran to address remaining differences between the US and Iran.
"Following consultations with the US, Qatari negotiators travelled to Tehran this morning to meet with the Iranians in an effort to bridge the remaining gaps," a diplomat with knowledge of the situation told AFP.
For his part, Trump said in a social media post that Iran has taken too long to negotiate a deal over the conflict and will now "have to pay the price."
Brent crude for August delivery traded higher at USD92.98 a barrel on Wednesday, up from USD90.90 at the time of the equities close in London on Tuesday, although still well below recent peaks.
"The oil market is trading on hope that a resolution can be found, and on a loosening of oil supply," said Kathleen Brooks, research director at trading group XTB.
She noted that declining onshore Middle Eastern oil inventories suggest "a significant amount" of oil is leaving the Gulf, although exports remain well below pre-war levels as the Strait of Hormuz remains largely blocked.
"This supply boost explains why the oil price is not surging on the latest outbreak of fighting in the Gulf," she said.
The pound traded at USD1.3397 on Wednesday afternoon, up from USD1.3381 on Tuesday. Against the euro, sterling firmed to EUR1.1593 from EUR1.1581 on Tuesday.
The euro traded higher against the greenback, at USD1.1556 on Wednesday against USD1.1551 on Tuesday. Against the yen, the dollar was trading at JPY160.46, higher than JPY160.29.
The yield on the US 10-year Treasury eased to 4.53% on Wednesday from 4.56% on Tuesday. The yield on the US 30-year Treasury narrowed to 5.00% from 5.03% on Tuesday.
Gold traded at USD4,129.15 an ounce on Wednesday, sharply lower from USD4,270.69 on Tuesday. This prompted falls in Endeavour Mining and Fresnillo, down 4.1% and 1.7% respectively.
Tritax Big Box REIT led the blue-chip gainers in London, up 4.9%, after it said the UK secretary of state for Housing, Communities & Local Government has approved its proposed data centre development near Heathrow Airport.
The London-based real estate investment trust focused on logistics properties in the UK said the decision relates to its planned data centre at Manor Farm, Heathrow.
On the FTSE 250, WH Smith plunged 16% as it raised GBP106 million to bolster its finances after lowering profit guidance for the second time in three months.
Trading has been hit by the Middle East crisis, particularly in North America.
Last August, the travel retailer was rocked after disclosing an overstatement of around GBP30 million of expected headline trading profit in North America. This led to the departure of chief executive Carl Cowling in November.
Dan Coatsworth, head of markets at AJ Bell said the downturn in trading coming off the back of an accounting hiccup is "not the best conditions to go cap in hand to shareholders".
Elsewhere, Ceres Power dropped 6.2% after it launched a fund raise, while Raspberry PI fell back 12%, continuing its recent up-and-down run, amid US tech weakness.
The biggest risers on the FTSE 100 were Tritax Big Box REIT, up 7.00p at 151.00p, Entain, up 17.60p at 601.00p, Land Securities, up 18.50p at 648.50p, Tesco, up 13.30p at 469.20p and Unilever, up 117.00p at 4,401.50p.
The biggest fallers on the FTSE 100 were Endeavour Mining, down 157.00p at 3,653.00p, Experian, down 63.00p at 2,556.00p, Mondi, down 17.00p at 718.40p, Weir Group, down 52.00p at 2,274.00p and Relx, down 54.00p at 2,548.00p.
Thursday's global economic calendar sees an interest rate call by the European Central Bank, plus US PPI and weekly jobless claims data.
Thursday's local corporate calendar has full year results from safety products manufacturer Halma and budget airline Wizz Air.
By Jeremy Cutler, Alliance News reporter
Comments and questions to [email protected]
Copyright 2026 Alliance News Ltd. All Rights Reserved.
Related Shares:
Tritax Big BoxWh SmithCeres PowerRaspberry PiEntainTescoLand SecuritiesUnileverEndeavour MiningMondiWeir GroupFresnilloExperianRelx