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Stock prices in London were mixed on Tuesday morning, while shares in FTSE 250-listed facilities management firm Mitie surged as it agreed a takeover; meanwhile AIM-listed IQE rose after a trading update. Investors also digested the latest UK economic data, which showed lower public sector borrowing, slower-than-expected growth in average earnings including bonuses, and a slightly lower-than-forecast unemployment rate. The UK borrowed £15.99 billion in June, down from £20.00 billion in May, which was revised downwards from £23.29 billion. Average earnings excluding bonuses grew by 3.4% for the three months ended May, in line with consensus. Including bonuses, average earnings rose 4.3%, down from 4.4% and below FXStreet-cited consensus of 4.5%. And the ILO unemployment rate was estimated at 4.9% for the quarter, up from 4.7% in the previous year but lower than consensus for a 5.0% increase. The number of people employed in the period increased by approximately 147,000, accelerating from the previous quarter’s increase of around 100,000. Meanwhile, the UK 10-year gilt narrowed to 5.02% at the Tuesday open from 5.04% on Monday afternoon. The 30-year gilt yield was 5.74% on Tuesday morning, narrowed from 5.76% The FTSE 100 index opened down 21.94 points, 0.2%, at 10,502.82. The FTSE 250 was up 97.77 points, 0.4%, at 23,638.48, and the AIM all-share was up 3.47 points, 0.5%, at 761.36. The Cboe UK 100 was down 0.3% at 1,044.85, the Cboe UK 250 was up 0.6% at 20,507.77, and the Cboe small companies was up 0.1% at 18,413.96. ‘The Footsie has been on the back foot in early trade as investors keep an eye on Middle East tensions, a stronger pound puts pressure on some listed multinationals, and investors assess the Burnham administration’s policies,’ Wealth Club Chief Investment Strategist Susannah Streeter commented. ‘A slightly more resilient snapshot of the UK labour market has lifted sterling...While unemployment has edged slightly lower compared with the previous quarter, suggesting employers are hanging on to staff, the rise in the claimant count underlines that many families continue to feel the squeeze. ‘Employment has largely stalled and economic inactivity remains stubbornly elevated, pointing to an economy that’s proving a little more resilient than expected but still sluggish.’ The pound was quoted higher at $1.3439 early Tuesday, compared to $1.3418 on Monday. Against the euro, sterling rose to €1.1761 from €1.1755 a day prior. ‘Sterling has nudged higher, an indication that investors are increasingly pricing in two further interest rate hikes from the Bank of England after figures showed the jobs market is holding up better than forecast,’ Streeter said. On the FTSE 100, Unilever fell 1.3%. The UK Competition & Markets Authority says it is inviting comments until August 5 regarding the proposed sale of Unilever Foods to Hunt Valley, Maryland-based McCormick. The planned transaction has an enterprise value of $44.8 billion. Mitie Group led the FTSE 250, up 39% after agreeing to a takeover offer from OCS. Each shareholder will be entitled to up to 221.6 pence in cash per share, comprising cash consideration of 218.5p and a final dividend of up to 3.1p for the year ended March 31, valuing Mitie at approximately £3.1 billion. Mitie also releases a trading update for the three months ended June 30, reporting 10% revenue growth to £1.41 billion and 4% organic growth ‘driven by new wins, projects growth and pricing’. On AIM, Harvest Minerals surged 38% after announcing its binding agreement to acquire Union Star Metals subsidiary Scanty, which holds a portfolio of eight ‘highly prospective’ ionic clay rare earth element projects in Brazil. IQE was up 13%. The supplier of advanced compound semiconductor wafer products and material solutions forecast full-year revenue growth of over 30%, with revenue totalling at least £64 million after trading surpassed management expectations. IQE cited demand for indium phosphide solutions for data centres’ optical photonics, as well as strength in the aerospace and defence segments. In small caps, RentGuarantor was up 4.5%. The UK provider of rent guarantee services said it estimates first-half revenue at £3.4 million, up year-on-year from £970,000, and a swing to adjusted Ebitda of £110,000 from a £124,000 loss. It reaffirmed its outlook for financial 2026 and 2027, targeting revenue ahead of the £5.9 million to £6.0 million consensus for the current year. In European equities on Tuesday, the CAC 40 in Paris was up 0.1%, as was the DAX 40 in Frankfurt. The euro stood at $1.1420, lower against $1.1441. Against the yen, the dollar was trading higher at JP¥162.60 compared to JP¥162.56. In Asia on Tuesday, the Nikkei 225 index in Tokyo closed up 3.0%. In China, the Shanghai Composite closed up 1.8%, while the Hang Seng index in Hong Kong closed marginally higher, as did the S&P/ASX 200 in Sydney. In the US on Monday, Wall Street ended lower, with the Dow Jones Industrial Average down 0.6%, the S&P 500 down 0.2% and the Nasdaq Composite down 0.6%. The yield on the US 10-year Treasury was quoted unchanged at 4.59%. The yield on the US 30-year Treasury was quoted at 5.12%, widening from 5.11%. Brent oil was quoted higher at $88.35 a barrel early in London on Tuesday, from $88.07 late Monday. Gold was quoted higher at $4,070.63 an ounce against $4,011.08. Still to come on Tuesday’s economic calendar are the ZEW economic sentiment surveys from the eurozone and Germany, followed by ADP jobs data in the afternoon. Copyright 2026 Alliance News Ltd. All Rights Reserved.
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