16th Jul 2026 12:07
(Alliance News) - Stock prices in London were mixed at midday on Thursday, with the FTSE 100 under pressure despite resilient UK GDP data earlier in the session, while merger activity and upbeat trading updates lifted the mid-cap index.
The FTSE 100 index was down 24.71 points, 0.2%, at 10,491.21. The FTSE 250 was up 86.15 points, 0.4%, at 23,548.54, and the AIM all-share was up 1.04 points, 0.1%, at 766.78.
The Cboe UK 100 was down 0.2% at 1042.25, the Cboe UK 250 was up 0.8% at 20,380.14, and the Cboe small companies was down 0.4% at 18,411.89.
Brent crude traded at USD84.71 a barrel at midday on Thursday, up from USD83.71 late Wednesday, as the US and Iran continued to exchange military strikes, keeping concerns over oil supplies through the Strait of Hormuz firmly in focus.
The UK economy returned to modest growth in May, although the recovery remained subdued as the conflict in Iran continued to weigh on activity through higher prices and supply chain disruption.
According to the Office for National Statistics, gross domestic product rose 0.1% in May after contracting 0.1% in April, matching market expectations. A 0.3% expansion in the services sector offset declines of 0.5% in production and 0.8% in construction.
Sterling strengthened to its highest level in a year against the dollar amid growing expectations that Home Secretary Shabana Mahmood will become chancellor under the incoming government led by Andy Burnham.
Mahmood has emerged as the frontrunner to replace Rachel Reeves at the Treasury when Burnham is expected to enter Downing Street on Monday, after weeks of speculation over his Cabinet appointments.
Energy Secretary Ed Miliband had previously been viewed as the leading contender for the role but is considered less favourably by financial markets amid concerns he would be less fiscally disciplined.
The pound was quoted at USD1.3506 at midday on Thursday, higher than USD1.3486 at the London equities close on Wednesday. Against the euro, sterling traded at EUR1.1777, down from EUR1.1791 a day earlier.
The euro traded at USD1.1465 at midday, slightly below USD1.1472 late Wednesday. Against the yen, the dollar was quoted at JPY162.16 versus JPY162.13.
Back in London, Diploma led the FTSE 100, climbing 4.7% after raising its full-year guidance for the third time in five months following what it described as a "very strong" third quarter.
The firm now expects organic revenue growth of 14%, up from previous guidance of 12%, while operating margin is forecast at around 26.5%, compared with 25% previously. The upgraded outlook implies adjusted operating profit around 7%, above analyst consensus of GBP454 million.
Diploma said strong execution in its Controls business and resilient trading across the group delivered 15% organic revenue growth in the first nine months of the financial year. It also noted that acquisitions completed so far this year will add around 6% to reported revenue growth and said its acquisition pipeline remains strong.
At the other end of the blue-chip index, St James's Place fell 5.4%, while Experian lost 2.3%.
Experian reported first-quarter revenue growth but left its full-year guidance unchanged, disappointing investors hoping for an upgrade.
On the FTSE 250, Rotork soared 67% after agreeing to a GBP4.14 billion cash takeover by Swiss engineering group ABB.
ABB will pay 506 pence per share in cash, representing a 73% premium to Rotork's Wednesday closing price. The deal values the Bath-based flow control specialist at GBP4.14 billion on a fully diluted basis.
Funding Circle rose 12% after reporting higher interim revenue and profit, while Dunelm added 4.2% after delivering sales ahead of expectations despite unseasonably warm weather affecting trading.
Ocado was the biggest mid-cap faller, tumbling 17%.
The online grocery technology company swung to a first-half pretax profit of GBP17.1 million from a GBP173.1 million loss a year earlier, while revenue jumped 54% to GBP1.04 billion.
However, both figures were boosted by GBP354 million of one-off partner termination fees. Excluding those payments, revenue rose just 1% to GBP684 million and adjusted Ebitda fell 12% to GBP81 million.
Ocado reiterated guidance for positive second-half cash flow, a full-year underlying cash outflow of around GBP200 million and positive free cash flow during financial 2027.
Trustpilot fell 10% despite reporting healthy bookings growth, as investors reacted negatively to the absence of an earnings upgrade.
Seraphim Space Investment Trust lost 5.1%.
Frasers Group declined 3.9% after withholding financial guidance while it assesses the impact of its proposed acquisitions involving Hugo Boss and Accent Group.
Among smaller companies, Foxtons dropped 11%, saying that trading since the first quarter has been affected by a prolonged downturn in residential sales activity and continued volatility in lettings.
Housebuilder Crest Nicholson also lost 11%, warning that trading conditions remained challenging during the first half.
Gooch & Housego surged 38% after agreeing to a cash acquisition by Arlington Capital Partners.
Across Europe, shares also traded lower.
The CAC 40 in Paris fell 0.7%, while Frankfurt's DAX 40 was down 0.6%.
Fresh data showed the eurozone's trade position deteriorated sharply in May as imports surged while exports were broadly unchanged.
According to Eurostat, the euro area's trade balance swung to a EUR7.8 billion deficit from a EUR15.0 billion surplus a year earlier.
Exports edged up just 0.1% year-on-year to EUR243.6 billion, while imports climbed 10% to EUR251.4 billion.
Compared with April, the deficit widened from EUR1.2 billion to EUR7.8 billion.
Eurostat said the deterioration reflected a wider energy deficit alongside smaller trade surpluses in machinery, vehicles, chemicals and related products.
Over the first five months of 2026, the euro area recorded a cumulative trade surplus of just EUR3.3 billion, sharply lower than the EUR78.7 billion surplus reported during the same period last year.
Stocks in New York were called mixed ahead of a busy afternoon of US economic data.
The Dow Jones Industrial Average was called up 0.2%, while the S&P 500 was expected to edge down 0.1% and the Nasdaq Composite to fall 0.5%.
Investors will monitor US weekly initial jobless claims at 1230 GMT, with investors expecting claims to rise to 217,000 from 215,000.
June retail sales are also due at 1230 GMT and are expected to increase 0.2% month-on-month after a 0.9% rise in May.
Pending home sales data follow at 1400 GMT, with forecasts pointing to a 0.5% monthly decline after a 3.8% increase in May.
The yield on the US 10-year Treasury was quoted at 4.57%, widening from 4.56% late Wednesday. The yield on the 30-year Treasury rose to 5.11% from 5.08%.
Gold traded at USD4,026.10 an ounce at midday on Thursday, down from USD4,048.39 on Wednesday.
Still to come on Thursday's economic calendar, the US releases weekly jobless claims, retail sales and pending home sales data.
By Eva Castanedo, Alliance News senior economics reporter
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