- FTSE 100 closes up 14 points at 9,142
- Smith & Nephew unveils £500m buyback after solid H1
- BP commits to UK listing, promises further review
- Diageo results mixed, profit guidance impresses
4.55pm: FTSE 100 edges higher
The FTSE 100 added 14 points to finish Tuesday’s session at 9,142, paring gains from earlier in the day.
Meanwhile, across the Atlantic, US stocks moved lower as the ISM services PMI surprised investors.
“The surge from Friday’s lows was rudely interrupted by today’s US ISM services PMI,” IG chief market analyst Chris Beauchamp said.
“While bad data can boost hopes of a Fed rate cut, there was the kicker of a rise in the prices paid sub-index, reminding markets that inflation is still a force to be reckoned with. Yesterday’s huge surge is still intact, so we can’t write off the bounce just yet, but investors need to remember that a rate cut isn’t the be all and end all of the situation.”
4.07pm: FTSE gains wiped out
The FTSE 100 gains have been completely wiped out, now less than one point in positive territory at just under 9,129, having been over 45 points higher not too long ago.
A spike in the pound is maybe a clue as to why, though sterling is only up 0.2% against the dollar at 1.33.
Meanwhile, the FTSE 250 is up 40 points at 21,900, falling from earlier gains above 127 points.
Among the Footsie's largest 20 stocks, only BP and LSEG are up more than 1%, with RELX, Lloyds, Rolls all down more than 1% and the top five largest names all flat.
Market analyst at Fawad Razaqzada at City Index says the US ISM services PMI disappointed, while investors are also watching Swiss tariffs negotiations.
"The US dollar was holding into the positive territory against a basket of foreign currency at the time of writing, despite a disappointing services PMI reading."
3.19pm: Tariff worries rise in US services sector
The US ISM services report found decreases in new exports and imports, which both moved from expansion to contraction, signalling that tariff tensions are impacting global trade.
Overall, the ISM services index fell to 50.1 for July from 50.8 in June, below expectations, as a rise in the prices paid index was offset by a fall in the new orders and employment indices.
The Institute for Supply Management's chair, Steve Miller, said the business activity index remained in expansion in July, but was also lower than the June reading.
The employment index was in contraction territory for the second month in a row and the fourth time in the last five months, while the prices index rose to 69.9% and has exceeded 60% for eight straight months to reach the highest since October 2022.
Miller continued: “July’s PMI level continues to reflect slow growth, and survey respondents indicated that seasonal and weather factors had negative impacts on business.
"The employment index’s continued contraction and faster expansion of the Prices Index are worrisome developments. The New Exports (a 3.2-percentage point decrease in July) and Imports (a 5.8-point drop) indexes, which both moved from expansion to contraction, provided signals that tariff tensions are impacting global trade."
The most common topic among survey panellists remained tariff-related impacts, with a noticeable increase in commodities listed as up in price, he said.
2.48pm: Wall Street starts higher
US stocks have got off to a modestly higher start, led by a 0.3% gain for the Nasdaq.
The S&P 500 is up 0.2% and Dow Jones is just above flat.
Palantir has risen 7%.
Tesla fell initially but is back in green now.
2.05pm: Our survey said: buy YouGov
Shares in YouGov PLC (AIM:YOU) polled 17% higher among investors after the market researcher, where founder Stephan Shakespeare returned to the CEO role earlier this year, put out a trading update confirming that full-year performance is on track with expectations.
Analyst Jessica Pok at Peel Hunt reiterated a 'buy' recommendation, arguing that the current valuation remains compelling at five times forecast enterprise value to earnings before interest, tax, depreciation and amortisation for 2026.
On an underlying basis, revenue grew modestly, as anticipated, with Data Products returning to low-single-digit underlying growth, driven by normalisation of renewals and new client wins, Research delivered modest growth and the rebranded Consumer Panel Services, now YouGov Shopper, performed slightly ahead of market expectations.
"Renewed focus on Data Products has led to improving trends in both client retention and new client wins, providing a solid foundation for growth in the new year," says Pok.
1.56pm: EV sales could be further boosted in coming months
On the UK car sales figures earlier, Ian Plummer, chief commercial officer at Auto Trader, said the government's electric car grant has "provided a much-needed boost" for consumer interest but has put the brakes on sales in the past month "as buyers wait to see just which models will get what level of grant".
With over a dozen brands now offering their own version of the grant, including some seeing three triple-digit increases in the number of buyers looking at their models his site, he said this should "trickle through" to the SMMT EV sales data in coming months.
“The Supreme Court ruling is also a welcome relief for industry, but clarity is the priority now – for both the industry and consumers.
"Finance is a key enabler of people being able to get into a new car and is also a vital component of the electric transition, so we need to ensure consumers trust the process and the industry."
12.59pm: Tesla sales keep sliding
UK sales of Tesla Inc (NASDAQ:TSLA) electric vehicles plunged over 60% last month, according to fresh data.
Industry body data just released shows that just 987 new Teslas were registered in the UK in July, almost 60% less than the 2,462 registered in July 2024. This means Tesla’s UK market share shrank to 0.7% in July, from 1.67% a year ago.
For 2025 to date, Tesla sales in the UK are 7% lower, during a year in which CEO Elon Musk has faced heavy criticism for his – now-soured – relationship with Donald Trump.
12.46pm: Footsie still rising
The FTSE 100 is continuing to rise as the session goes on, up 0.5% to only around 20 points from its recent record high.
Similarly, the FTSE 250 is up 121 points or 0.55% at 21,980.1, though the mid-cap index is still a long way from its 2021 peak of over 24,000.
Top of the blue-chip leaders are Smith & Nephew, up 15.4%; Melrose Industries, up 5.1%; Fresnillo, up 4.9%; and BP, up 2.2%.
Leading the mid-caps is Travis Perkins (LSE:TPK), up 6.4% as the building materials distributor revealed that the business has begun to stabilise.
Analysts at Stifel described the half-year results as broadly in line with expectations, noting that merchanting like-for-like sales showed improvement, narrowing from a 3.2% decline in the first quarter to a 1% drop in the second.
Next in line is Oxford Nanopore Technologies PLC (LSE:ONT), up 5.4% after Citi upped forecasts and price target.
"We continue to see the long term growth outlook as intact, given increased focus in applied/biopharma/clinical markets," the US bank said, setting its new TP at 240p, up from 180p.
11.38am: UK car sales fall, but EVs up
UK electric car sector grew in July, while overall new car registrations fell 5%, according to preliminary data released the industry.
The Society of Motor Manufacturers and Traders (SMMT) data showed that 140,154 vehivles were registered, the weakest July since 2022.
Sales of battery-powered vehicles rose 9.1%, giving BEVs a 21.3% share of the market.
Strong growth was seen for Tesla's Chinese EV rivals, with BYD more than quadrupling sales to 3,184, boosted by the cheaper Dolphin Surf, with starting prices under £19K.
So far this year BYD has increased sales 514% to 22,574 compared to just over 23,700 for Tesla, which saw sales fall year-on-year in July.
"July’s dip shows yet again the new car market’s sensitivity to external factors, and the pressing need for consumer certainty," says SMMT chief Mike Hawes.
"Confirming which models qualify for the new EV grant, alongside compelling manufacturer discounts on a huge choice of exciting new vehicles, should send a strong signal to buyers that now is the time to switch.
"That would mean increased demand for the rest of this year and into next, which is good news for the industry, car buyers and our environmental ambitions."
11.21am: Palantir makes further progress
There's lots of chat about Palantir Technologies Inc (NYSE:PLTR) this morning, as the shares jump almost 5% in premarket US trading following the company’s earnings last night saw its first-ever quarter exceeding $1 billion in revenue.
Already the best performing US stock this year, Peter Thiel's software firm, which does a lot of work for government agencies and defence clients, hailed the impact of AI as a key driver of sales and improved guidance.
Earnings and revenue both beat analyst expectations, with adjusted earnings per share of 16 cents and revenue at $1 billion.
CEO Alex Karp said Palantir aims to increase revenue while reducing headcount, describing the strategy as "a crazy, efficient revolution" and said "we’re very sorry our haters are disappointed."
Market analyst Chris Beauchamp at IG called Palantir's share price progress "astounding" to a "sky-high valuation".
"Demand for AI services remains strong, a theme we saw last week in the earnings from its megacap cousins, and high cash generation provides the fuel for more share price gains.
"Despite this Palantir is not a stock for the faint-hearted, since the risk of a nasty fall if it disappoints in earnings remains high."
10.16am: Burberry checks
Shares in Burberry Group PLC (LSE:BRBY) were up 1% earlier but are now down 0.8% amid wider weakness in the luxury sector after Hugo Boss highlighted the challenges facing global fashion groups.
The German group warned that consumer sentiment remains weak worldwide.
But Hugo Boss managed to deliver a slightly better-than-expected quarterly operating profit, thanks largely to cost-cutting rather than top-line growth.
9.48am: Services new business contracts, hiring subdued, but inflation easing
July saw the UK services sector record a third consecutive monthly rise in business activity, but not quite the growth rate achieved in June, says Tim Moore, economics director at S&P Global Market Intelligence alongside the PMI survey.
He says new business intakes swung back into contraction territory, with the downturn in order books the fastest for over two-and-a-half years.
"Risk aversion and low confidence among clients were the main reasons provided for sluggish sales pipelines, alongside an unfavourable global economic backdrop.
"Hiring trends were especially subdued, with total workforce numbers decreasing to the greatest extent since February. Worries about rising payroll costs were cited as the main factor holding back recruitment."
Positive news on inflation, as Moore says that while suppliers continued to try and pass on rising employment costs, the latest increase in input prices across the service economy was the slowest since December 2024.
"Despite headwinds from strong cost pressures and lacklustre domestic economic conditions, service providers remain upbeat overall regarding the year ahead business outlook."
Optimism also improved, helped by receding concerns about US tariffs for the UK, and hopes of a boost to business and consumer spending from interest rate cuts this month and maybe another later in the second half of the year.
9.36am: Services PMI falls less than expected
UK services companies reported a decline in momentum last month, but not quite as much as expected.
The UK services PMI for July fell to 51.8 from 52.8 in June, but this was the third month in a row above the 50 mark that separates expansion from contraction.
It was up from the 51.2 'flash' reading that came out mid-month.
Along with the manufacturing PMI that was printed on Friday, the UK composite PMI was 51.5, up from the 51 flash reading.
9.28am: Big picture warning
The FTSE 100 and 250 are both moving upwards this morning following a busy morning of results.
Europe is mixed, Germany's DAX is up 0.3%, but French and Italian benchmarks are flat and Spain's is down 0.6% with banks on the slide.
A "quick word on the big picture" from Neil Wilson at Saxo.
"We had a proper interruption to this melt-up grind higher, which is the kind of correction that is needed.
"But the market likely requires stronger medicine than this."
With the market now moving aggressively in favour of a September rate cut by the Federal Reserve, after a weak July jobs report and ugly revisions to May and June, this "pushed the US closer to stagflationary territory, which has been a long-term fear among bears; ie that we end up with a 1970s market that drifts sideways".
"So far, the market has held up and looked beyond the tariff risks, but we may at last be seeing the hard data finally catch up with the soft survey data.
"Front-loading and corporates wearing tariff costs by maintaining flat pricing may have masked the real impact but this may be changing."
He notes that the 2001 dotcom era and 2007 financial crisis saw the market bottom out long after the first rate cuts were made.
"We are seeing signs of a slowdown in the US economy, as Friday’s labour market report indicated. But we have a couple of problems in assuming that this means the Fed is about to race to cut at its next policy meeting in September."
8.50am: BP momentum shifting
London and European stocks are getting a boost from earnings this morning, with some strong results being reported.
"The UK index is higher on Tuesday, but it is underperforming other European indices for a second day, even though BP reported stronger than expected results," says market analyst Kathleen Brooks at XTB.
She notes that BP's adjusted net income was significantly higher than expected despite a 15% drop versus last year.
"BP is much less interested in telling the public about the number of coffees it sells each year (in excess of 100 million under former CEO Bernard Looney) and is now focused on how much oil it can extract," says Brooks, saying the 1.6% share price rise comes as "the momentum for the company has shifted in recent weeks".
BP also seems to be moving on from rumours that it was going to be acquired by Shell and speculation that a move to the US was on the cards.
"The company has reduced net debt and capex spend, however, it plans to go even further, which is necessary as it comes under pressure from its activist investor, Elliott Management. The company will also conduct a further review under the tenure of its new chairman, to look for further divestment opportunities."
8.29am: Fresnillo making silver hay while the spot price sun shines
Silver miner Fresnillo increased first-half gross profit 160.7% to $1.02 billion and net profit nearly 300% to $467.6 million, driven by higher gold and silver prices, alongside increased sales volumes and lower production costs.
The Mexico-based group reported cash and liquid funds of $1.82 billion at the period end.
"Our profitability has significantly improved, driven not only by favourable precious metals prices but also by a consistent operational performance and rigorous cost discipline," said chief executive Octavio Alvídrez.
"This has led to a substantial free cash flow generation."
8.16am: Smith & Nephew, Fresnillo and Diageo lead FTSE charge
The FTSE 100 has continued to climb back towards its recent highs, adding another 21 points to 9,149.7.
Leading the charge this morning is Smith & Nephew PLC (LSE:SN), up over 11% after the knee- and hip-replacement group maintained full-year guidance, reporting robust revenue growth, rising profitability and a $500 million share buyback.
Precious metals miner Fresnillo PLC (LSE:FRES) is up 9% and Diageo PLC (LSE:DGE) up over 6% after both their results impressed too.
It is a more modest 1.2% gain for BP PLC (LSE:BP.) on the back of its numbers.
8am: BP beats
BP PLC (LSE:BP.) beat expectations for second-quarter earnings and unveiled a larger-than-expected dividend and a new $750 million share buyback.
The oil producer reported adjusted earnings per share of 15.03 US cents for the second quarter of 2025, up from 8.75 cents in the first quarter, down compared to 16.61 cents a year ago and above the consensus estimate of 11.71 cents.
Underlying replacement cost profit of $2.35 billion was up from $1.4 billion in Q1 but down from $2.75 billion in Q2 last year, though also ahead of analyst expectations.
7.45am: Diageo profits plunge, sees improvement next year
Diageo PLC (LSE:DGE) has reported a 28% drop in full-year profit as sales improved in the second half and kept its dividend flat.
The Guinness and Baileys maker said it expects to market and grow profit at a mid-single-digit percentage in the coming year, helped by increased savings, product innovation and a strong presence in non-alcoholic drinks.
Net sales declined 0.1% to $20.2 billion for the year to 30 June, in line with the analyst forecasts, while organic net sales grew 1.7%, up from 1% in the first half of the year.
Interim chief executive Nik Jhangiani, in charge after Debra Crew stepped down last month, increased the company's cost savings target by $125 million under its 'Accelerate' programme to around $625 million over three years.
7.27am: Business investment being held back
The Organisation for Economic Co-operation and Development (OECD) has warned that weak corporate investment poses a significant threat to global economic growth.
Corporate spending in most developed economies has not recovered to pre-financial crisis or COVID-19 pandemic levels, it found, with average net investment in member countries down from 2.5% of GDP before the 2008 crisis to 1.6% in middle-performing countries.
Álvaro Pereira, the OECD's chief economist, affirmed that countries will be unable to sustain growth if corporate investment in new projects and facilities does not increase.
Out of the 34 developed economies tracked by the OECD, only Israel and Portugal had surpassed pre-financial crisis net investment levels by last year, while six countries, including Canada, Italy and Australia exceeded pre-pandemic levels.
Pereira argued that political uncertainty was a major reason for weak corporate investment, as companies face repeated shocks, such as the trade policies implemented by the Trump administration leading to companies hesitating to make significant spending decisions, resulting in a decline in investment across all major sectors.
7.15am: FTSE 100 called higher
The FTSE 100 has been called higher ahead of the start of trading on Tuesday morning, continuing the rebound after the sell-off at the end of last week.
Futures for London's blue-chip benchmark were pointing 33 points higher, adding to the gain of almost 60 points the day before, which saw the index close at 9,128.3 as investors "bought the dip" and car finance lenders rallied.
Across the pond, all the main Wall Street indices closed strongly higher overnight, with the tech-powered Nasdaq rising just under 2% and the domestically focused small cap Russell 2000 index up 2.1%, with the S&P 500 and Dow Jones adding 1.5% and 1.3% respectively.
Asian markets are mostly in green this morning, apart from Indian benchmarks, after Donald Trump threatened to ramp up tariffs on the country from their already 25% level, due to its buying and selling of Russian oil.
"The higher probability of a September rate cut from the Fed supported a jump in Wall Street equities overnight, which also enjoyed a bit of reflexive bounce after such heavy selling on Friday," says market analysts Kyle Rodda at Capital.com.
With rates markets now seeing a 95% chance of a September cut from the Federal Reserve, according to the CME FedWatch tool, this is "undoubtedly positive for equity valuations".
Other analysts noted that August tends to be a volatile month, and has started on that note so far.
6.30am: FTSE 100 Live on Tuesday 5 August
BP PLC (LSE:BP.) issued guidance last month that second-quarter numbers and outlook were not quite as bleak as many had feared.
Since then, the oil group named Albert Manifold, former boss of US-listed construction materials group CRH, as its new chair, reigniting New York listing speculation, and yesterday unveiled its largest oil discovery in 25 years.
A big boardroom change was also announced by Diageo PLC (LSE:DGE), with shares spiking last month after the Guinness and Smirnoff maker said that CEO Debra Crew had stepped down, meaning these numbers will be overseen by CFO and interim boss Nik Jhangiani.
Her departure was unlikely to mark a turning point for the world’s largest spirits group, analysts said, and while the search is on for her successor, the focus at the results will be on the outlook for 2026, which is expected to show modest organic sales growth.
In macroeconomic news, services sector purchasing manager surveys (PMIs) should be closely followed for several major economies, with the last UK update revealing the fastest expansion for almost a year, with new orders rising for the first time in three months.
There's also UK new car sales and a Treasury auction for 10-year gilts.
Later, Pfizer and Caterpillar will report before the opening bell on Wall Street, with semiconductor names AMD and Super Micro among those after the close.
Announcements expected:
Trading updates: BP
Interims: Domino's Pizza, Fresnillo, GlobalData, International Workplace Group, Keller Group, Rotork, Serica Energy, Sig, Smith & Nephew, Spirent, Travis Perkins
Finals: Diageo
Overseas announcements: Amgen, Ball Corp, Caterpillar, Pfizer (all premarket), Advanced Micro Devices, Arista Networks, Lemonade, Lucid Group, Rivian Automotive, Snap, Super Micro Computer, Upstart Holdings (all afterhours)
Economic announcements: Services PMI (CHN, EU, UK, US), New Car Sales (UK, GER), Treasury Gilt 2035 Auction (UK), PPI (EU), Balance of Trade (US), Redbook (US), ISM Services PMI (US), API Crude Oil Changes (US)