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The FTSE 100 kicked off Wednesday in the red, as earnings from the likes of HSBC, Rio Tinto and Taylor Wimpey failed to impress. Elsewhere, US growth figures, a Federal Reserve decision, a tariff deadline and nonfarm payrolls are among the risk events looming large over markets. The FTSE 100 index traded down 36.55 points, 0.4%, at 9,099.77. The FTSE 250 was up marginally by 3.68 points at 21,796.75, and the AIM All-Share was down 0.52 points, 0.1%, at 765.23. The Cboe UK 100 was down 0.4% at 909.18, the Cboe UK 250 was up marginally at 19,130.86, and the Cboe Small Companies was 0.4% lower at 17,603.45. In European equities on Wednesday, the CAC 40 in Paris was up 0.2%, while the DAX 40 in Frankfurt was 0.2% lower. The pound rose to $1.3364 early Wednesday, from $1.3337 at the time of the London equities close on Tuesday. The euro rose to $1.1556 from $1.1537. Against the yen, the dollar faded to JP¥148.04 from JP¥148.38. The yield on the 10-year US Treasury eased to 4.33% from 4.35%. The 30-year yield slimmed to 4.87% from 4.88%. SPI Asset Management analyst Stephen Innes commented: ‘GDP, the Fed, payrolls, and four of the world’s most systemically important stocks all crowding into the same narrow macro window. Toss in the August 1 tariff trigger and you’ve got enough tinder to blow the lid off this low-vol regime. No more coasting. This is where the market either earns its multiple or cracks it wide open.’ 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. Rabobank analysts commented: ‘It has been five years since there has been more than one dissenting voice at a FOMC meeting, but there is plenty of speculation that today’s policy announcement could bring two opposing votes. The market consensus is strongly pointed towards steady rates from the Federal Reserve today with a potential hint that the next move could follow in September.’ Rabobank noted Michelle Bowman, Fed vice chair for supervision and board member Christopher Waller ‘have hinted they would favour an immediate rate cut’. ‘The release of the July ADP employment report will add a little more colour ahead of the Fed’s announcement as will the release of US Q2 GDP data,’ Rabobank analysts added. ‘Official US data have generally failed to reflect the pessimism captured by spring US confidence surveys and as Trump has rolled back the tariffs threats made in April, the market has downgraded US recession fears to expectations of a slowdown in growth.’ The US and China have failed to reach an agreement to extend a pause on high mutual tariffs after talks in Sweden. At a press conference in Stockholm on Tuesday, US Trade Representative Jamieson Greer announced that he would return to Washington to hold talks with President Donald Trump over the tariff pause, which is set to expire on August 12. ‘Nothing is agreed until we speak with President Trump,’ Treasury Secretary Scott Bessent said. Chinese trade representative Li Chenggang said that both sides will continue to advocate a ‘continued extension’ of the tariff pause, according to the Xinhua official news agency. However, he gave no indication as to when and for how long an extension could come into force. In London, HSBC shares fell 4.1%. The Asia-focused lender maintained its dividend and announced a new share buyback programme despite reporting a sharp drop in first half profit. The bank said pretax profit fell 27% to $15.81 billion in the six months ended June 30 from $21.56 billion a year earlier. Revenue declined 8.5% to $34.12 billion in the first half from $37.29 billion in the previous year. HSBC maintained its interim dividend at $0.10 per share, but announced plans to initiate and complete a $3 billion share buyback before its third quarter results are released. Away from London, the banking sector was also in focus after earnings from Santander and UBS. Santander fell 2.2% in Madrid, but announced a €1.7 billion as underlying attributable profit rose on-year to €3.43 billion, a new record, from €3.21 billion. UBS hailed ‘robust momentum’. Second quarter profit attributable to shareholders rose to €2.40 billion from €1.14 billion a year earlier. Shares rose 1.0% in Zurich. Back in London, Taylor Wimpey shares fell 6.0%. It was the worst large-cap performer. The housebuilder backed guidance for full year UK completions of between 10,400 to 10,800 but now sees operating profit at £424 million. It had previously expected an outcome in line with consensus of £444 million. ‘Following robust trading in the first quarter, we experienced softer market conditions during the second quarter. While lenders remain committed to the UK mortgage market, affordability remains an issue, particularly for first time buyers. Against this backdrop, our highly engaged sales teams remain focused on driving high-quality lead generation and conversion to sales,’ it said. Rio Tinto fell 1.5%. The miner said pretax profit in the first half of 2025 fell 17% to $6.74 billion from $8.12 billion hurt by an iron ore price that was ‘13% lower’ during the period. In the FTSE 250, refractory products maker RHI Magnesita fell 13%. It said market conditions ‘remain challenging, with end market demand weakness expected to continue’ into the second half. RHI’s revenue in the first half of the year fell 3.0% to €1.68 billion from €1.73 billion, while pretax profit slumped to €14 million from €143 million. Aston Martin fell 5.4%. The carmaker now predicts an annual adjusted earnings before interest and tax ‘towards breakeven’. It had previously forecast a ‘positive adjusted Ebit’. ‘Whilst the impact of the recently announced US tariffs on the global economy remains uncertain, several factors have been reflected in a slight revision to some of the group’s FY 2025 guidance. These include the impact from foreign exchange rates movements, increased investment in software and infotainment enhancements and the group’s decisive action to support its dealers in China to reduce stock levels prior to future market improvements,’ Aston Martin added. On the up, International Personal Finance said it would be ‘minded to recommend’ a roughly £500 million bid from asset-based financing provider BasePoint Capital. IPF, a provider of credit products and insurance services, confirmed it is in advanced discussions with BasePoint. A price per share of 223.8 pence has been mooted, a sum IPF would recommend to shareholders should an official bid materialise. ‘The board is confident in its strategy and in the company’s standalone future, recognising the strong performance to date outlined in the 2025 half year results released today. However, it has carefully considered the possible offer with its advisers and has concluded that the possible offer is at a value that the board would be minded to recommend unanimously to IPF shareholders,’ the firm said. ‘Accordingly, the board is in advanced discussions with BasePoint in relation to these terms and other transaction documentation, following completion of due diligence satisfactory to BasePoint.’ Separately, IPF reported a rise in half-year pretax profit, an increase in its dividend but a fall in revenue. Revenue fell 6.4% on-year to £347.8 million from £371.7 million but pretax profit rose 37% to £49.9 million from £36.5 million. IPF lifted its dividend by 12% to 3.8p per share from 3.4p. It is confident ‘in delivering an acceleration of growth in the second half’. A barrel of Brent rose to $72.01 early Wednesday, from $70.74 at the time of the London equities close on Tuesday, while gold rose to $3,331.23 an ounce from $3,327.45. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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