1st Jul 2026 09:16
(Alliance News) - Stock prices in London opened slightly higher on Wednesday, as defence stocks continued to rise but Associated British Foods and JD Sports weighed on the FTSE 100.
The FTSE 100 index opened up 6.83 points, 0.1%, at 10,503.95. The FTSE 250 was up 20.62 points, 0.1%, at 23,034.07, and the AIM all-share was down 2.43 points, 0.3%, at 769.74.
The Cboe UK 100 was flat at 1,042.41, the Cboe UK 250 was down 0.2% at 19,742.87, and the Cboe small companies was down 0.1% at 18,167.57.
In European equities on Wednesday, the CAC 40 in Paris was up 0.4%, while the DAX 40 in Frankfurt was 0.1% higher.
Sterling was at USD1.3245 on Wednesday morning, down from USD1.3263 at the London equities close on Tuesday. Against the euro, sterling was flat at EUR1.1612 from EUR1.1614.
The euro was lower at USD1.1402 from USD1.1419. Against the yen, the dollar firmed to JPY162.67 from JPY162.60.
Annual house price growth ticked higher in June, though prices were flat on-month, according to data from Nationwide.
The Nationwide house price index showed annual house price growth picked up to 2.2% in June from 1.7% in May.
On a seasonally adjusted monthly basis, house prices were broadly flat, after a 0.6% fall in May.
The average UK house price, not seasonally adjusted, stood at GBP277,484 in June compared to GBP278,024 in May.
Nationwide Chief Economist Robert Gardner said: "It is not surprising that the market has softened a little in recent months, given the uncertainty caused by developments in the Middle East and the subsequent rise in energy prices and market interest rates. Indeed, consumer confidence and measures of housing sentiment have weakened, and mortgage approvals fell noticeably in May."
If the recent fall in energy costs is maintained, Gardner said it will "help to restore household confidence" and "ease affordability constraints". This could allow a recovery in housing market activity, as long as there is not an adverse impact from domestic political uncertainty.
Meanwhile, US and Iranian officials will hold indirect lower-level technical talks with mediators on Wednesday on a deal aimed at permanently ending the Middle East war, a diplomat with knowledge of the talks told AFP.
"US and Iranian officials are to hold indirect technical talks on Wednesday in Doha with Qatari and Pakistani mediators on the memorandum of understanding and building on the progress made at the Lake Lucerne Summit," the diplomat said.
US envoys Jared Kushner and Steve Witkoff would not be taking part in the technical talks, the diplomat added, after they met with Qatar's Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani on Tuesday.
Brent crude was trading slightly lower at USD72.88 a barrel on Wednesday morning from USD73.04 on Tuesday.
In Asia on Wednesday, the Nikkei 225 in Tokyo was up 0.6%. In China, the Shanghai Composite was 0.5% higher, while the S&P/ASX 200 in Sydney fell 0.6%. Financial markets in Hong Kong are closed on Wednesday.
In the US on Tuesday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.3%, while the S&P 500 ended 0.8% higher and the Nasdaq Composite gained 1.5%.
The yield on the US 10-year Treasury was quoted at 4.47% on Wednesday morning, widened from 4.40% on Monday. The yield on the US 30-year Treasury grew to 4.96% from 4.89%.
Back in London, JD Sports Fashion was down 2.2%, in negative read-across from Nike's results on Tuesday night.
Nike said progress will "continue to be uneven" as hopes for a long-awaited rebound continued to be frustrated.
"Work will take time to scale and translate into consistent results," Chief Executive Elliott Hill told analysts on the earnings call after fourth quarter results.
"We know we're not living up to our full potential, particularly in Nike Sportswear and Jordan Streetwear, where sell-through remains challenged impacting both current discounting and future order books," he added.
Nike said net income ballooned to USD1.07 billion in the three months to May 31 from USD211 million the year prior.
Basic and diluted earnings per share climbed to USD0.72 from USD0.14 a year ago, including a USD0.52 benefit related to the expected recovery of the International Emergency Economic Powers Act tariffs. Visible Alpha consensus looked for EPS of USD0.11 excluding the tariff impact.
Outgoing Chief Financial Officer Matthew Friend said the operating environment became "more challenging" going through the quarter.
"After a stronger start in March, especially in North-America, by mid-April, we began to see a deceleration in retail sales trends," he added.
Shares in Associated British Foods were 2.7% lower.
The London-based food, ingredients and retail group said group revenue rose 3% to GBP5.30 billion in the third quarter, and is in line in constant currency. Retail revenue rose 4% to GBP2.92 billion and Grocery revenue grew 5% to GBP1.04 billion.
Primark like-for-like sales were down 2.2% in the third quarter and are 2.5% lower in the year-to-date.
Chief Executive George Weston said: "While the retail environment remained challenging in most markets, Primark continued to strengthen its customer proposition, including new product launches, a sharper focus on price and increased investment in marketing, particularly digital. We are making good progress and there is more to come. Grocery and Ingredients delivered solid results. In Sugar, the duration and severity of the Middle East conflict have increased gas price expectations for next year, which has impacted our European profit outlook. Aside from Sugar, our full year outlook for the group is unchanged."
The firm continues to expect adjusted operating profit and adjusted earnings per share to be below last year.
Defence stocks continued to trade higher in the UK, in the wake of the announcement of an uplift to the government's defence investment plan on Tuesday.
Babcock International led the FTSE 100 and rose 4.6%, BAE Systems was 2.4% higher and Melrose grew 1.7%.
On the FTSE 250 index, CMC Markets led the way and jumped 23% after it lifted its annual guidance.
London-based CMC said momentum has "continued to build and scale" in the current financial year.
It now expects net operating income for the year that ends in March 2027 to be at least GBP550 million, "materially" higher than its prior GBP460 million to GBP480 million view. It expects earnings before interest, tax, depreciation and amortisation of GBP250 million.
Net operating income in financial 2026 rose 15% to GBP392.6 million. The guidance for financial 2027 suggests growth will pick up markedly to 40%. Ebitda in financial 2026 totalled GBP117.8 million, so CMC expects it to more than double in the current financial year.
Among small caps, shares in Topps Tiles fell 5.0% as it reported lower third quarter revenue due to "challenging market conditions".
The Leicestershire, England-based tile retailer said revenue, including CTD, for the third quarter was GBP75.6 million, down 1.8% on-year. It said this was due to tough market conditions as well as the effect of prior year store closures in CTD and the previously announced closure of underperforming Topps Tiles stores.
Revenue, excluding CTD, rose 0.6% to GBP69.4 million.
"Since the interim update, we have seen some margin pressure as ongoing uncertainty in the macroeconomic environment has led to a current greater demand for lower priced products," Topps Tiles said.
"In addition, recent periods of extreme heatwave conditions led to temporary work stoppages among housebuilders and traders, further affecting activity levels," it added.
Topps Tiles now expects adjusted pretax profit to be above GBP6.5 million, down from GBP9.2 million in the previous year. The firm previously said it expects "modest" on-year profit growth.
Gold was lower at USD3,971.45 an ounce early on Wednesday from USD4,032.83 late Tuesday.
Still to come on Wednesday's economic calendar is UK manufacturing PMI, due shortly, as well as eurozone CPI data and the ADP private payroll report in the US.
By Michael Hennessey, Alliance News reporter
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JD SportsAB FoodsBabcockBAE SystemsMelroseCMC MarketsTopps Tiles