Late market roundup: London stocks edge down as US inflation heats up

London-listed equities ended Wednesday a little weaker, with oil stocks down on lower Brent pricing, and markets absorbing data which pointed to stronger than forecast US inflation.

The FTSE 100 index closed down 8.04 points, 0.1%, at 10,878.12. The FTSE 250 ended up 41.79 points, 0.2%, at 24,897.84, and the AIM All-Share closed down 0.58 of a point, 0.1%, at 814.90.

The Cboe UK 100 was up 0.1% at 1,083.12, the Cboe UK 250 was up slightly at 21,687.48, but the Cboe Small Companies fell 0.4% at 18,994.64.

On Wall Street, stocks made a subdued start to trading after a stronger than forecast inflation reading, while the dollar climbed.

The Dow Jones Industrial Average was down 0.2%, as was the Nasdaq Composite, while the S&P 500 index was flat.

The personal consumption expenditures price gauge rose 3.7% on-year in July, in line with June's expansion, but topping the FXStreet cited forecast of 3.6%.

The core PCE index advanced 3.3% on-year in July, in line with June and the consensus. The core reading is the Federal Reserve's preferred inflation gauge.

ING Chief International Economist James Knightley said the inflation rate was a touch firmer than anticipated, but "that is OK".

"As long as the month-on-month rate continues to come in close to 0.2% [month-on-month], the annual rate of inflation will converge on 2% over time, but the question is how much more patience the Fed actually has. Markets continue to price a 25bp rate hike before year-end while economists, in general, still favour an extended pause for policy rates," he noted.

The pound traded at USD1.3590 on Wednesday afternoon, down from USD1.3632 at the equities close on Tuesday. Against the euro, sterling eased to EUR1.1664 from EUR1.1683.

The euro stood lower at USD1.1651 against USD1.1671. Against the yen, the dollar was higher at JPY159.37, compared to JPY159.25.

The yield on the US 10-year Treasury stretched to 4.66% on Wednesday from 4.65% on Tuesday. The yield on the US 30-year Treasury fell to 5.18% from 5.19%.

Nvidia stood 1.1% lower ahead of Wednesday's earnings which will be released after the Wall Street close.

Bank of America says the Santa Clara-based chip maker should deliver the "usual" 3% to 4% sales beat and raise but thinks what matters are balance sheet disclosures.

"The beat is priced; the balance sheet is the debate," BofA said, suggesting a "buyback pivot toward Apple-style payouts is the underappreciated 2H and CY27 catalyst to re-rate the stock."

Meta Platforms was also in the news, with shares up 2.3%, as it said it has agreed to pay US states as much as USD18 billion and to impose sweeping new limits on how teenagers use its social media platforms.

The Menlo Park, California-based firm which owns Facebook and Instagram said the payment of USD18 billion can be used to fund youth online safety initiatives, among other state priorities.

The payment will be distributed in annual instalments over a 10-year period.

In European equities on Wednesday, the CAC 40 in Paris closed up 0.3%, while the DAX 40 in Frankfurt rose 0.1%.

Back in London, falls in oil majors BP and Shell, and accountancy software provider Sage, limited progress.

Brent oil for October delivery traded at USD88.09 a barrel on Wednesday, down from USD89.31 late Tuesday.

"Discussions between Iran and Oman over the establishment of a temporary corridor through the Strait of Hormuz, US sanctions on Tehran which were less strict than expected, and hints at continuing diplomatic efforts have helped bring Brent crude oil down," said AJ Bell investment director Russ Mould.

"This has helped take the edge off market fears about inflation," Mould added.

Reflecting the weaker oil price BP and Shell were down 1.1% and 0.5% respectively.

Sage led the FTSE 100 fallers, down 3.8%, after Intuit, which owns accountancy software QuickBooks, lowered FY27 sales guidance.

For financial 2027, Intuit guided to revenue of USD23.28 billion to USD23.51 billion, on-year growth of 9% to 10%, below FactSet consensus of USD23.72 billion, and slower than 14% growth in the financial year just ended.

Intuit traded 4.2% lower on Wall Street recouping earlier heavy falls.

Hochschild Mining led the gainers on the FTSE 250, up 6.3%, as it reported a strong financial first half performance supported by higher metals prices.

London-based Hochschild is a gold and silver miner in Argentina, Brazil and Peru. Pretax profit surged to USD365.8 million in the six months ended June 30 from USD109.3 million the year prior, as revenue climbed 62% to USD844.4 million from USD520.0 million.

Hochschild said that while gold production was "broadly similar" to a year ago, the average realised gold and silver prices jumped 47% and 130% respectively, boosting revenue.

In the red, Softcat fell 1.8%, as Deutsche Bank Numis downgraded its rating to 'hold' from 'buy'.

On AIM, Nexteq was up 11% as its display and human machine interface technology brand Densitron won a new order from "a leading supplier of automotive electronics" for customised electric vehicle display solutions, with production starting in the second half of 2026.

Nexteq said it expects production volumes "to materially increase in the following three years as the customer's product rollout expands."

Gold traded at USD4,596.56 an ounce on Wednesday, down from USD4,642.09 on Tuesday.

Gold "has rallied a long way in a short space of time, so traders shouldn't be surprised to see a bit of a correction to the downside, or at least a period of consolidation," said David Morrison, senior market analyst at Trade Nation.

The biggest risers on the FTSE 100 were JD Sports Fashion, up 2.56p at 87.86p, IG Group, up 37.00p at 1,393.00p, British American Tobacco, up 105.00p at 4,238.00p, Howden Joinery, up 19.50p at 820.00p and Standard Chartered, up 42.00p at 2,182.00p.

The biggest fallers on the FTSE 100 were Sage Group, down 41.50p at 1,063.00p, Compass, down 0.72p at 30.08p, 3i Group, down 60.00p at 2,844.00p, AstraZeneca, down 242.00p at 12,234.00p and Autotrader, down 10.00p at 539.20p.

Thursday's global economic calendar has US initial jobless claims and wholesale inventories data plus the Kansas City Fed manufacturing activity report.

Thursday's UK corporate calendar has half year results from packaging and labelling supplier Macfarlane Group and Park Plaza and art'otel hotel operator PPHE Hotel Group.

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