Early market roundup: FTSE 100 up as AI-boosted UK GDP grows in July

Stock prices in London were up a notch on Friday morning as official data showed that the UK economy grew in July amid an output rise in artificial intelligence-related activities, while investors remain cautious due to high oil prices ahead of a US consumer prices data print.

The FTSE 100 index opened up 12.87 points, 0.1%, at 10,621.79. The FTSE 250 was up 19.20 points, 0.1%, at 23,901.65, and the AIM all-share was up 0.75 points, 0.8%, at 788.70.

The Cboe UK 100 was up 0.2% at 1,056.53, the Cboe UK 250 was marginally higher at 20,707.53, and the Cboe small companies was up 0.1% at 18,560.57.

Gross domestic product expanded 0.4% month-on-month in July, building on growth of 0.3% in June, according to the Office for National Statistics.

Compared with July 2025, GDP was 1.6% higher.

In the three months to July, the economy grew 0.4% compared with the three months to April, matching growth in the three months to June and marking the eighth consecutive three-month period of expansion.

The ONS said evidence showed that, across computer programming, consultancy and related activities and information services, many of the businesses reporting the largest turnover in July were involved in activities related to artificial intelligence and cloud computing. Output in these sectors rose 1.1% in July.

Separately, UK goods imports rose by £1.3 billion, or 2.4%, in July, driven by a £1.7 billion increase in imports from non-EU countries, partly offset by a £400 million fall in imports from the EU, according to the ONS.

Goods exports increased by £900 million, or 2.8%, with exports to the EU rising £800 million and those to non-EU countries up £100 million.

Over the three months to July, the UK's total trade deficit in goods and services narrowed by £1.1 billion to £9.0 billion from the three months to April. The goods trade deficit narrowed by £400 million to £61.6 billion, while the services trade surplus widened by £700 million to £52.6 billion.

In European equities on Friday, the CAC 40 in Paris was up 0.4%, while the DAX 40 in Frankfurt was up 0.3 %.

Brent oil traded at USD105.94 a barrel early Friday, up from USD105.51 late Thursday.

The pound was quoted at USD1.3515 early Friday, lower than USD1.3532 at the London equities close on Thursday. Against the euro, sterling was marginally higher at EUR1.1637 from EUR1.1636 a day prior.

The euro traded at USD1.1605 early Friday, lower than USD1.1625 late Thursday, after the European Central Bank raised interest rates for the second time this year.

Against the yen, the dollar was quoted at JPY154.25, up from JPY154.10.

Back in London, British American Tobacco rose 1.3% to the top of the FTSE 100, while Games Workshop Group gained 1.1% and Hiscox added 1.1%.

At the other end of the blue-chip index, Relx fell 2.3%, Sage Group lost 2.0%, and London Stock Exchange Group declined 1.9%.

On the FTSE 250, XP Power jumped 11% after Jefferies raised the power-control components manufacturer to 'buy' from 'hold' and lifted its price target to 2,330p from 1,870p.

Renishaw rose 3.1% after Jefferies upgraded the engineering technology company to 'buy' from 'hold', raising its price target to 6,090p from 3,450p.

Trainline rose 2.0% after reporting resilient first-half trading, reiterating its full-year guidance and announcing a new £100 million share buyback programme.

Group net ticket sales were broadly flat year-on-year at £3.26 billion, while underlying revenue slipped 1% to £233 million.

The rail and coach travel platform said UK rail demand remained resilient despite disruption from hot weather, strikes and a regulated fare freeze, and expects its first-half adjusted earnings before interest, tax, depreciation and amortisation margin to be slightly ahead of its full-year target.

Trainline reconfirmed guidance for financial 2027 net ticket sales of £6.20 billion to £6.45 billion, underlying revenue of £440 million to £455 million, and an adjusted Ebitda margin of around 2.9%.

It also announced a new £100 million share repurchase programme, which will begin after completion of its existing £150 million buyback and run over the following 12 months in two tranches.

Since launching buybacks in 2023, Trainline has repurchased and cancelled £350 million of shares, representing around 28% of its issued share capital. The company will publish its half-year results on November 4.

Among smaller caps, C&C Group rose 5.5% after agreeing to acquire Asahi UK's wholesale interests for a nominal consideration, including Nectar Imports Ltd and Asahi UK's direct distribution operations, which it will integrate into its Matthew Clark Bibendum business.

The deal also includes a long-term partnership to distribute Asahi brands in the UK and is expected to complete in early October, with management expecting a small positive contribution to earnings in the current financial year.

Separately, C&C said trading in the six months to August 31 was in line with expectations. Net revenue fell 3% on a constant-currency basis, as 2% growth in branded sales was offset by a 4% decline in distribution revenue.

The group expects first-half underlying operating profit of EUR43 million to EUR44 million and remains on track to deliver full-year operating profit in line with market expectations. C&C will host a capital markets day on September 24 and report interim results on October 28.

Meanwhile, shares in everplay shot up 11%.

The Wakefield, England-based app and video game company said it sold one million copies of Wardogs, a 100-player tactical first-person shooter game, one day after its launch into Steam Early Access.

In Asia on Friday, the Nikkei 225 index in Tokyo closed down 1.9%. In China, the Shanghai Composite was closed down 1.2%, while the Hang Seng index in Hong Kong ended down 0.6%. The S&P/ASX 200 in Sydney closed down 0.9%.

In the US on Thursday, Wall Street ended lower, with the Dow Jones Industrial Average down 0.6%, the S&P 500 down 0.6% and the Nasdaq Composite down 0.7%.

The yield on the US 10-year Treasury was quoted at 4.95%, widening from 4.92%. The yield on the US 30-year Treasury was quoted at 5.36%, widening from 5.34%.

Gold was quoted at USD4,405.56 an ounce early Friday, higher than USD4,363.96 on Thursday.

Still to come on Friday's economic calendar are US consumer price inflation figures and the monthly budget statement.

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