Lunchtime market roundup: FTSE 100 down as metals miners drag

Stocks were mostly lower at midday on Wednesday, after weaker-than-expected Chinese data sparked concerns for future metals demand, and in light of further US strikes on Iran.

The FTSE 100 index was down 23.23 points, 0.2%, at 10,505.74. The FTSE 250 was down 65.53 points, 0.3%, at 23,341.60, and the AIM all-share was down 1.46 points, 0.2%, at 764.12.

The Cboe UK 100 was down 0.1% at 1,043.34, the Cboe UK 250 was down 0.4% at 20,073.77, and the Cboe small companies was up 0.1% at 18,510.63.

Tensions in the Middle East remained elevated after the US renewed its naval blockade of Iranian ports and exchanged fresh strikes with Tehran over the Strait of Hormuz.

The latest escalation came after US President Donald Trump abandoned plans for a 20% levy on vessels using the strategic shipping lane, although Washington subsequently reinstated the blockade as fighting entered its fifth day.

Iran's Revolutionary Guards warned that oil and gas exports from the region would be available "for everyone or for no one", saying the renewed US blockade had disrupted exports through the Gulf.

Deputy Foreign Minister Kazem Gharibabadi said Washington's decision had effectively dismantled the interim agreement reached last month to halt hostilities and pursue peace negotiations.

Meanwhile, US Central Command said it had struck dozens of Iranian military targets near the Strait of Hormuz and elsewhere along Iran's southern coast in an effort to reduce Tehran's ability to threaten commercial shipping.

Oil prices extended recent gains on concerns over potential supply disruptions. Brent crude traded at USD85.55 a barrel at midday Wednesday, up from USD84.00 late Tuesday.

The pound was quoted at USD1.3390 at midday Wednesday, down from USD1.3396 at the London equities close on Tuesday. Against the euro, sterling rose to EUR1.1727 from EUR1.1709. The euro fell to USD1.1413 from USD1.1432, while the dollar strengthened to JPY162.41 from JPY161.96.

Back in London, mining stocks weighed heavily on the FTSE 100 after weaker-than-expected Chinese economic growth clouded the outlook for metals demand.

China's National Bureau of Statistics said gross domestic product expanded 4.3% year-on-year in the second quarter, slowing from 5.0% growth in the first quarter and missing the FXStreet-cited consensus forecast of 4.5%.

Quarter-on-quarter, GDP increased 0.9%, matching expectations, while the urban unemployment rate edged down to 5.0% in June from 5.1% in May.

Elsewhere in the data, industrial production accelerated to 5.3% annual growth from 4.5%, beating forecasts, while retail sales rebounded 1.0% after a 0.6% fall in May, comfortably ahead of expectations.

Nevertheless, concerns over the broader slowdown in China's economy hit metals prices and mining shares.

Fresnillo was the worst FTSE 100 performer, down 3.0%, followed by Antofagasta, down 2.2%, and Endeavour Mining, down 2.0%.

Gold traded at USD4,028.00 an ounce at midday Wednesday, down from USD4,085.44 late Tuesday, adding further pressure to precious metals miners.

At the top of the FTSE 100, Intermediate Capital Group rose 4.0% after reporting higher assets under management in the first quarter and highlighting strong fundraising momentum, with one of its flagship funds on course for a record close.

Barratt Redrow added 2.7% after announcing plans to return £400 million to shareholders through a share buyback programme and dividends.

Vodafone Group fell 2.3%, giving back some of the gains made after billionaire telecoms investor Xavier Niel became its largest shareholder last week. BT Group lost 1.9%, pressured by read-across from Vodafone's decline.

On the FTSE 250, Galliford Try Holdings climbed 6.7% after saying annual profit is expected to come in at the top end of market forecasts.

Hunting rose 5.0% after reporting "solid" first-half trading and reiterating its full-year guidance.

At the other end of the index, B&M European Value Retail fell 4.8% after saying UK trading remained subdued during the first quarter, despite stronger growth in France.

Seraphim Space Investment Trust, meanwhile, lost 3.6%.

Stocks in New York were called higher. The Dow Jones Industrial Average was called marginally higher, the S&P 500 index was seen rising 0.1%, and the Nasdaq Composite was called up 0.4%.

Investors are awaiting US producer price inflation data for June, due at 1230 GMT. Annual PPI is expected to ease to 6.2% from 6.5% in May.

The yield on the US 10-year Treasury widened to 4.61% from 4.56%, while the yield on the 30-year Treasury rose to 5.12% from 5.07%.

In corporate news, BlackRock shares rose 5.3% in premarket trading after the asset manager reported record first-half net inflows and beat expectations for both earnings and revenue.

Net income increased 20% to USD1.91 billion in the second quarter from USD1.59 billion a year earlier.

GAAP diluted earnings per share rose 20% to USD12.19 from USD10.19, while adjusted diluted EPS increased 15% to USD13.91, comfortably ahead of the Bloomberg-cited consensus of USD12.66.

Chair & Chief Executive Larry Fink said: "Our momentum is accelerating, and I've never been more optimistic about the growth ahead."

Meanwhile, eurozone industrial production unexpectedly declined in May.

According to Eurostat, industrial output in the single-currency area fell 0.2% month-on-month after a revised 0.3% increase in April, missing the FXStreet-cited consensus for a 0.2% rise.

Compared with a year earlier, industrial production declined 1.2%, steeper than the expected 0.5% fall.

The monthly decline reflected weaker production of intermediate goods and durable consumer goods, which more than offset gains in energy and capital goods output.

Attention later in the session will also turn to the Bank of Canada's interest rate decision at 1345 GMT, where policymakers are expected to leave the benchmark rate unchanged at 2.25%.

Still to come on Wednesday's economic calendar are the US producer price inflation and the New York Empire State manufacturing index, alongside the Bank of Canada rate call and Canadian manufacturing sales and capacity utilisation data.

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