- FTSE 100 up 2 points
- Water firms warn of failure over bill cap
- Gold price retreats
3.59pm: FTSE 100 set for slight gain
The FTSE 100 failed to rack up any meaningful gain on Wednesday as miners and banks weighed heavily on the index.
Come late trading, London’s blue chips had gained just two points to reach 8,347.
Bottling company Coca-Cola HBC AG led the risers late on with a 2.6% gain, followed by GSK PLC (LSE:GSK, NYSE:GSK), up just shy of 2%.
GSK had benefited on the back of news Delaware Supreme Court would hear an appeal against lawsuits on Zantac and its alleged connection to cancer in the company's bid to throw out some 70,000 claims.
BAE Systems PLC (LSE:BA.) and Aviva PLC (LSE:AV.) were also among risers in the absence of many big upward movers, with Prudential PLC (LSE:PRU) failing to hold onto earlier gains after results.
Miners and banks then dominated the fallers, with Antofagasta PLC (LSE:ANTO) down over 4.8% as copper prices fell throughout the day.
A fall in gold prices on Wednesday also saw Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) and Fresnillo PLC (LSE:FRES) slip.
NatWest Group PLC (LSE:NWG) sat as the FTSE 100’s second-biggest faller, down 3%, as the likes of Barclays PLC (LSE:BARC) and Lloyds Banking Group PLC (LSE:LLOY) also dipped on speculation banks could face a tax raid in the Autumn Budget.
3.47pm: Nvidia’s update: What to watch for
Nvidia’s post-market update today has drawn wide-ranging focus as investors expect yet another earnings beat from the chipmaking giant.
Here’s a rundown on what to watch out for… Read more
3.24pm: Banks drop on budget tax raid fears
Banks accounted for some of FTSE 100’s biggest fallers on Wednesday on speculation they could foot a rise in taxes hinted at by the Prime Minister.
NatWest Group PLC (LSE:NWG) dropped 3.4% throughout the day, while Barclays PLC (LSE:BARC) and Lloyds Banking Group PLC (LSE:LLOY) fell by 2.6% and 1.5% respectively.
This follows Keir Starmer’s speech on Wednesday, where he alluded to tax hikes in the Autumn Budget to fill a £22 billion “black hole” in public finances.
He had said the October budget would be “painful,” adding those “with the broadest shoulders should bear the heaviest burden”.
This has prompted speculation that banks could be the target of tax hikes, with a senior Whitehall adviser hinting the move to the Financial Times.
“There are banks who’ve been making good profits out of higher interest rates,” they said, “they’ve got broad shoulders and no one likes banks”... Read more
2.55pm: Wall Street opens lower as eyes fixed on Nvidia update
Wall Street faced a cautious start to the day on Wednesday as investors awaited Nvidia’s latest update after the market’s close.
The Nasdaq headed 30 points down at the open, while the Dow Jones and S&P 500 just moved into the red.
Nvidia’s post-market report is set to dominate proceedings on Wednesday given the chip maker’s heavyweight position, with forecasts being for yet another earnings beat.
Nvidia moved 1.1% lower as the market opened ahead of its update, with analysts noting options pricing implied a 10% swing either way if the company beat or fell short of expectations in the results.
“The fear coming into this earnings report is the unforgiving nature of market expectations, with the company priced for perfection,” Scope Markets analyst Joshua Mahony commented.
“Markets will want to see the already incredible pace of growth maintained or bettered, despite the fact that such expansion is quite clearly unsustainable.
“Any signs that Nvidia’s growth may have peaked could yet cause widespread losses for equities, providing a potential sign that the AI trade has started to ease off.”
CrowdStrike, another of Wednesday’s reporters, also moved lower as trading got underway, with the after-hours update due following last month’s global IT outage.
2.40pm: Shell, BP fall as oil rally reverses
Shell PLC (LSE:SHEL, NYSE:SHEL) and BP PLC (LSE:BP.) moved lower on Wednesday as a surge in oil prices in recent days looked to have met its end.
Shell fell 1.2%, while BP ducked 0.5% as both Brent and West Texas Intermediate (WTI) reversed on recent gains throughout the day.
Brent fell 1.7% to US$78.52 a barrel, having sat above US$81.00 on Monday, while WTI dipped 1.9% to US$74.42.
Prices have been buoyed recently by growing tensions in the Middle East, with strikes between Israel and Lebanon’s Hezbollah over the weekend prompting a rally.
Fears over a halt in production in Libya also drove prices in recent days, with Hargreaves Lansdown analyst Susannah Streeter noting these had begun to dissipate.
“Nevertheless, high tensions remain in the Middle East, given the situation in Gaza, which are set to keep a floor under elevated prices,” she said.
2.23pm: Thames Water asks to up bills by £228 a year
Thames Water has requested to raise consumer bills by over 50% and well above Ofwat’s proposed cap on hikes, arguing extra money is needed for infrastructure upgrades.
The privately owned utility submitted a proposal to lift average water bills to £666.50 per customer per year by 2030 on Wednesday, marking a 52% increase from £433 currently.
Thames, which supplies 16 million people in and around London, said Ofwat’s proposals to cap its bill hikes by £94 annually over the next five years would leave upgrade plans “neither financeable nor investible”.
This comes after a report from industry body Water UK on Wednesday warned capping bill hikes for firms could result in failures, with Thames itself already on the brink of renationalisation... Read more
1.57pm: Gold scales back as traders reasses
Gold prices scaled back on Wednesday, falling below the US$2,500 mark as traders appeared to take a breath following a rally in recent weeks.
By Wednesday afternoon, gold was down near 0.6% for the day at US$2,498 per ounce, having sat as high as US$2,529 early in the morning.
SP Angel analysts noted investors were likely reassessing the strength of the US economy ahead of personal consumption expenditures data later this week.
This comes after expectations for a Federal Reserve rate cut in September surged with comments from chair Jerome Powell last week, sending the dollar down and gold up.
SP Angel added traders were continuing to weigh up whether such a cut could be by a dramatic 50 basis points, which in turn would spell further positive news for gold prices.
Wednesday’s blip coincided with an uptick in the dollar, by 0.44% to 0.7574p, after the pound had hit a two-year high against the green-back on Tuesday.
1.28pm: Ted Baker to return to UK online
Ted Baker will relaunch online in the UK after the brand's last shops across the country were shut for good.
US-based owner Authentic Brand Group said on Wednesday that a deal had been struck with a new European partner which will see the Ted Baker brand return online.
This comes after the last 31 physical Ted Baker shops in the UK shut their doors last week, following previous manager No Ordinary Designer Label’s collapse into administration earlier in the year.
United Legwear & Apparel Co will now manage Ted Baker’s e-commerce operations in the UK, following similar agreements with Authentic in the US and Canada... Read more
12.29pm: Wall Street set for cautious start ahead of Nvidia earnings
Futures had the Nasdaq, Dow Jones and S&P 500 just off the mark ahead of Wednesday’s opening bell and much-anticipated results from Nvidia Corp later.
Nvidia is due to report after the market closes on Wednesday, with expectations “sky-high” for its latest in a string of earnings beats, according to Swissquote Bank analyst Ipek Ozkardeskaya.
“Nvidia has a weight of around 6% in the S&P 500 and it accounted for a third if its gains of the index this year,” she said.
“So the company’s earnings announcement day is naturally a big day for the market.”
The S&P 500 was seen just in the red ahead of the market's open, while futures showed the Dow Jones and Nasdaq off 4 and 2 points respectively.
Ozkardeskaya noted post-market volatility could be on the cards after Nvidia’s update, with the company forecasting second-quarter sales of US$28 billion, but the market anticipating this to climb as high as US$32 billion.
“Based on options pricing, the stock could move around 10% up and down after the results,” she said.
12.13pm: Water firms slated over warnings on bill hike cap
Water firms’ have been slated after warning on Wednesday that a proposed cap on bill hikes to 2030 could lead to failures.
Gary Carter, national officer at GMB union, attacked the claims, arguing water firms had previously failed to deliver upgrades anyway.
“Water companies have had the money, failed to invest in plugging leaks and preventing sewage spills and now want more money to do what they failed to do,” he said.
“It’s absolute balderdash and Ofwat must say enough is enough.”
Industry body Water UK had warned Ofwat’s draft cap, which would equate to a £19 a year ceiling on bill hikes between 2025 and 2030, created a “material risk” to efforts in securing funding for infrastructure upgrades, which will also be a regulatory requirement.
“If they want investment, water companies must be fundamentally reformed,” Carter added.
“They have failed bill payers and their employees who have faced increased assaults and abuse because of the tarnished reputations of their employers.
“It’s time the shareholders paid for the investment the water companies promised but haven’t delivered.”
12.00pm: Banks, miners drag FTSE 100 lower
The FTSE 100 headed towards mid-day in negative territory on Wednesday, dragged lower by miners and banks.
Come late morning, London’s blue-chip index was down 8 points at 8,336.
Banks and miners primarily weighed down the index, with Antofagasta PLC (LSE:ANTO) falling almost 5% and NatWest Group PLC (LSE:NWG) down 3.9% to lead the day’s losers.
Fresnillo PLC (LSE:FRES), Barclays PLC (LSE:BARC), Lloyds Banking Group PLC (LSE:LLOY), Anglo American PLC (LSE:AAL), Glencore PLC (LSE:GLEN) and Rio Tinto PLC also fell throughout the morning.
For miners, declines came after the likes of copper receded from gains earlier in the week as fears over Chinese demand looked to persist.
Banks appeared to take a hit on news the FCA would launch a probe into the pure protection market, which encapsulates life insurance, meanwhile.
The FCA said it wanted to gauge consumers’ understanding of such products and assess if they reflected fair value for customers, with commissions said to raise concerns.
This comes as part of the FCA’s Consumer Duty push, with reports equating concerns in the probe to those seen in the payment protection insurance scandal, which saw tens of billions of pounds paid out in compensation after policies were missold between 1990 and 2010.
11.18am: EV slowdown prompts changes at Polestar and Hyundai
Polestar and Hyundai both signalled changes on Wednesday as carmakers grapple with a slowdown in electric vehicle demand.
Hyundai unveiled plans to double the number of hybrid models it offers to 14 on Wednesday.
Polestar announced chief executive Thomas Ingenlath would be replaced by Michael Lohscheller in the meantime, after having taken the helm in 2017.
This comes after data in recent weeks has shown stagnating demand for new EVs in the likes of the US, UK and Europe, placing targets in the latter two for a phase-out of petrol and diesel cars by 2035 in doubt.
Hyundai said the move would aim to “address the EV deceleration by expanding its hybrid and new extended-range EV offerings”.
EV models will then be “gradually” ramped up by 2030 “when a recovery in demand is expected,” the company added, following the likes of Ford, Porsche and Mercedes in making similar moves
Outgoing Polestar boss Ingenlath previously slammed drivers for not making the switch in an interview.
“I see far too many people hesitating with that and being scared of change,” he said,” that is just not a good recipe for the future”.
10.50am: B&Q owner slips as Citi sees end to stock’s ‘good run’
B&Q owner Kingfisher PLC (LSE:KGF) took a hit on Wednesday after Citigroup analysts downgraded the company, citing weakness in overseas markets.
“We continue to see scope for stronger UK outlook on the back of healthy consumer sentiment trends and higher housing market activity in 2025 and 2026,” the bank said.
However, “limited upside risks” remain on “ongoing weakness in France and incrementally lacklustre consumer sentiment trends in Poland,” analysts added.
Citi bumped Kingfisher down from a ‘buy’ to a ‘neutral’ as a result, but left its share price target unchanged at 292p... Read more
9.59am: Copper drops, miners fall back
Following gains earlier on in the week, miners fell back on Wednesday as “lingering concerns” around Chinese demand persisted, according to AJ Bell analysts.
This saw copper fall 1.4% to US$4.24 a pound, with iron ore trading flat after optimism earlier in the week on news Chinese stockpiles had depleted appeared to peter out.
Antofagasta PLC (LSE:ANTO) led the FTSE 100’s losers on Wednesday as a result, falling 3.2%, followed by the likes of Anglo American PLC (LSE:AAL) and Rio Tinto PLC.
These weighed down the FTSE 100 come mid-morning, which slipped into the red at 1 point down following a rise earlier on.
9.40am: RAC calls for 6p cut to petrol price
Calls have emerged for forecourt prices to be cut as petrol is sold for 6p more a litre than it should currently be worth, according to RAC.
The motor group said an average price of 142p was far ahead of the 103p a litre wholesale value last week, with a coinciding drop in oil and strengthening of the pound meaning drivers should be paying less at the pump.
“The biggest retailers’ refusal not to reduce their prices to fairer levels is continuing to cost drivers dear,” RAC policy head Simon Williams said.
Accounting for a retailer margin, petrol should still be closer to 136p and diesel at 139p against its average current price of 147p, RAC added.
“While the Competition and Markets Authority has clearly stated drivers were overcharged last year, it’s blatantly apparent from our data that this problem is persisting,” Williams continued.
“If prices don’t fall dramatically in the next week or so, we believe the government and the CMA should get all the biggest retailers together to demand an explanation.
“Tough action needs to be taken to change this as drivers are losing out badly every time they fill up.”
9.27am: Hochschild slumps following interims
Hochschild Mining PLC (LSE:HOC, OTCQX:HCHDF) slumped and took the place of the FTSE 250’s biggest faller on Wednesday, despite a seemingly positive set of interims.
Revenue climbed 25% to US$391.7 million over the first half of the year, the firm reported, while adjusted earnings jumped 78% to US$177.1 million.
This came as the company enjoyed a “perfect storm” of record high gold prices, falling costs and optimised production, according to eToro analyst Adam Vettese.
Hochschild did warn of delays at its Mara Rosa site though, but said better-than-expected production at Inmaculada should offset this.
Investors seemed unconvinced, however, with shares falling 5.7% following the update.
9.04am: Prudential at mercy of turnaround in Asia - analysts
Prudential PLC (LSE:PRU)’s results clearly show the life insurer is in the hands of a wider economic turnaround in Asia, analysts have said.
The FTSE 100 listed firm reported a drop in interim profit from US$947 million to US$182 million on Wednesday, largely driven by lower investment returns.
However, following Prudential’s shift to the Asian life sector, eToro analyst Mark Crouch noted the refocus was realistically to blame.
“Inflationary pressures and higher interest rates have acted as a constant drag throughout that period,” he acknowledged.
“Yet it is Prudential's heavy exposure to Asia, where consumer demand has been severely shaken post-pandemic, that is the primary reason behind the insurer's dismal performance.”
Consistent new business profit, which ticked up 1%, could be among positives to take from the update, Crouch added, alongside a recently announced US$2 billion share buyback.
Richard Hunter, of interactive investor, added held guidance showed Prudential was "beginning to deliver against its own stretching strategic objectives" in a promising turn.
“Ultimately [Prudential] will require a swift and significant turnaround in the Asian and specifically the Chinese economy to recover,” though, according to Crouch.
“However, with growing concerns looming over China's property sector, it's uncertain whether or not that recovery is close at hand.”
Shares fell early on before regaining ground.
8.49am: Aviva, L&G brush off life insurance probe
Aviva PLC (LSE:AV.) and Legal & General Group PLC (LSE:LGEN) climbed on Wednesday morning, despite news an FCA probe would be launched into the pure protection insurance market.
This will study commission arrangements and whether such insurance policies, which pay out after death, reflect fair value.
Panmure Liberum analysts noted Aviva, L&G and Phoenix were the most exposed to the market among listed insurers.
Investors seemed unfazed however, with Aviva climbing almost 1% and L&G gaining 0.3% following the FCA’s announcement… Read more
8.32am: FTSE 100 just in green
London’s blue chips opened just in the green on Wednesday morning, ticking up 1 point to 8,346.
Bottling company Coca-Cola HBC AG was among early risers, alongside GSK PLC (LSE:GSK, NYSE:GSK) following news Delaware Supreme Court would hear an appeal against lawsuits on Zantac and its alleged connection to cancer.
Housebuilders also climbed early on, reversing on declines seen on Tuesday, while miners looked to weigh down the index after having risen earlier in the week.
Prudential PLC (LSE:PRU) fell too in the meantime, after reporting a slump in first-half profit… Read more
8.24am: GSK climbs as Zantac cancer case to be heard in supreme court
GSK PLC (LSE:GSK, NYSE:GSK) gained on Wednesday following news Delaware Supreme Court would hear an appeal to throw out lawsuits over Zantac and its alleged connection to cancer.
Some 70,000 lawsuits have accused the heartburn drug, which was discontinued in 2020, of causing cancer over concerns active ingredient ranitidine could become carcinogenic.
GSK, alongside Pfizer and Sanofi, will now challenge a lower court ruling allowing expert testimony on the alleged link to cancer.
“The scientific consensus remains that there is no consistent or reliable evidence that ranitidine increases the risk of any cancer,” GSK said in a statement.
“Since 2019, there are 16 epidemiological studies looking at human data regarding the use of ranitidine, including outcomes for more than 1 million patients using ranitidine, supporting this consensus.”
GSK climbed 1.2% to 1,637p.
7.50am: FCA to probe pure protection insurance market
Britain’s Financial Conduct Authority is to probe the pure protection insurance market over concerns around commission agreements and poor value.
A market study will begin over the coming months into how pure protection products, which provide cover in the event of death or incapacitation, are sold, the FCA said Wednesday.
Some £4 billion was paid out in such claims in 2022, according to the FCA, with the insurance mainly being sold through brokers or independent advisors.
“The design of commission arrangements may not allow firms to deliver good outcomes to policyholders,” the FCA said in a statement.
“The regulator is also concerned that some products may be providing poor value, for example if the total premiums paid over a lifetime far exceed the maximum conceivable payout.”
Work will take place to gauge consumers’ understanding of such products, competitive restraints in the market and whether commission agreements create a conflict of interest.
7.32am: Water firms at risk of failure over cap on bill hikes - report
Water firms have argued a proposed cap on bill hikes will create a risk of failures across the industry.
An average £19 a year ceiling “would likely result in significant investability issues for the sector as a whole,” a report from Oxera on behalf of industry body Water UK, due to be published on Wednesday, will say, according to BBC News.
“In particular, there is a material risk that the sector is unable to raise the new equity investment required to finance the proposed investment programme,” it will add.
Regulator Ofwat has proposed the cap, which would equate to an average 21% increase across England and Wales, to last until 2030, with a final decision due in December.
Such an increase is said to be just a third of what Water UK wants, with the report arguing firms will need to be profitable in order to attract investment.
This comes as London’s supplier, Thames Water, has emerged on the brink of renationalisation after racking up over £15 billion worth of debt... Read more
7.14am: Stocks seen higher
The FTSE 100 is expected to open higher once again on Wednesday, following gains seen on Tuesday.
Futures had London’s blue chips up 20 points at 8,394, with a widely quiet day expected on the company front in London before NVIDIA and CrowdStrike update across the Atlantic.
Prudential is among the few names in London out with an update this morning, which shows revenue up 8% but pre-tax profit down by almost half.
Elsewhere, overnight data from Zoopla says house prices ticked up 1.4% over the year so far as buyer demand and agreed sales have surged... Read more
Water firms have also slammed a proposed cap on bill hikes from regulator Ofwat, with industry body Water UK arguing the move could create a “material risk” of failures in the industry.