- FTSE 100 rises 19 points to 9,228
- Bank of England holds rates
- Next shares slide as outlook held, slightly gloomy views
- Pets at Home plunges as CEO leaves on profit warning
- US Fed cut rates 25bps last night
4.42pm: Stocks edge higher
The FTSE 100 added 0.2% or 19 points to close at 9,228, little changed after the Bank of England held rates steady.
“Sterling continues to ease back from the overnight highs despite the BoE holding rates unchanged,” IG chief market analyst Chris Beauchamp said.
“Bearish positioning in the dollar has run its course for now, which points towards an extended period of weakness for both sterling and the euro. This should help to support UK and European stocks, which have seen investor enthusiasm cool in recent weeks.”
4.19pm: Trump and Starmer share text of tech pact
Topping the FTSE leaderboard are Croda International, up 5%, and Halma, up 3.4%.
Tech funds, Polar Capital Technology Trust and Scottish Mortgage Investment Trust, are also in the top ten, along with RELX, ICG, Experian, Informa and Weir Group.
Holding the London blue-chip index back is a fall for oil prices, with Brent down 0.5%.
Elsewhere, Donald Trump and Keir Starmer have held a press conference and shares the text of the US-UK 'Technology Prosperity Deal' that the two leaders say renews the Special Relationship between the countries.
At a press conference, Donald Trump says it may have been a better deal for the UK than the US.
Starmer says it is "a good deal for both of us" and from the tech sector should create around 15,000 jobs in the UK.
3.44pm: FTSE lagging
The FTSE 100, up 0.2%, is lagging the rest of Europe still.
Germany's DAX has jumped 1.4% and France's CAC is up 1.1%, with the Euro Stoxx 50 rising 1.7% and the Stoxx 600 up 0.9%.
In currency markets, the euro is down 0.3% versus the dollar at $1.1775 and the pound is down 0.5% at $1.3558.
When the US-Europe equity market gap opened up earlier this year, it was mostly about straightforward European market outperformance. For a while after liberation day, it was about half driven by real outperformance, half by the falling euro. Now, it's *mostly* a euro thing. pic.twitter.com/FWjstSWpBV
— Mike Bird (@Birdyword) September 18, 2025
2.46pm: Mixed US open
Oh, the Wall Street has not been quite as positive as the futures market was indicating.
The Dow Jones is down 24 points, almost 0.1%, while the S&P 500 has advanced 0.2% and the Nasdaq 0.5%.
Intel is the top riser among Nasdaq 100 companies, up 27%, while Nvidia is up 2.4%.
Dragging the Dow into the red are falls for Disney, Procter & Gamble and McDonalds, with Microsoft and Amazon both just below flat.
2.39pm: On the QT
Has the BoE easing its pace of bond buying helped the government at all?
Economist Salomon Fiedler at Berenberg explains: "Because the BoE bought the bonds in its portfolio when interest rates were much lower than today, it is now running a loss.
"Because the BoE passes on any gains and losses to the treasury, this affects the government’s finances in two ways. (1) When the BoE sells bonds (or they mature), the bank is crystalising valuation losses. (2) If the BoE keeps the bonds in its books but they yield less than the bank rate it pays on the reserves that are the corresponding liability on its balance sheet, it earns a negative interest-rate spread.
"Thus, by reducing the pace of QT, the BoE avoids valuation losses now – but is setting itself up for higher interest-rate losses down the line.
"We estimate that the reduction in QT to £70 billion from £100 billion may give the government an extra £7-8 billion or so now (c0.3% of GDP).
"However, it may then add around £3-4 billion in interest cost in fiscal year 2029/30, the year that is crucial for the government’s fiscal rules."
1.57pm: Trump and Starmer sign tech pact
Donald Trump and Keir Starmer have held a press conference to sign a US-UK tech deal, after last night announcing a £150 billion package of investments during the US President's state visit, which ends today.
New commitments unveiled included a £100 billion investment from Blackstone in the UK over the next decade and £3.9 billion from Prologis across the UK’s life sciences and advanced manufacturing.
At the press conference this afternoon, Trump said: "It’s an unbreakable bond we have. Regardless of what we’re doing today, I think it’s unbreakable."
He says the tech agreement is "historic" and benefit industrial capacity in both countries, with that the wider deal "will create opportunities for farmers in the US worth billions", which seems to imply an agricultural element unusual in tech deals.
Starmer says the deals and investment that are being announced today "break all records. What a day -- £250bn flowing both ways across the Atlantic.
"It is the biggest investment package of its kind in British history by a country mile."
1.50pm: Former MPC member's thoughts
The direction for interest rates "remains downwards but the MPC is in no rush", says Michael Saunders, senior economic advisor at Oxford Economics and a former policymaker.
"The MPC is clearly worried about risks of inflation persistence, especially that the current elevated level of inflation expectations will keep pay growth relatively high.
"Before cutting again, the MPC will need to see stronger evidence that pay growth is slowing to a target-consistent pace and that slower pay growth will feed through to lower services inflation."
Saunders says this indicates that the next cut might not come until early 2026, rather than before the end of this year.
"The decision to slow QT and scale back sales of long gilts is sensible and reduces risks that -- in current stressed gilt market conditions -- QT could have adverse side effects by adding significant upward pressure on yields."
1.16pm: BoE should have gone further
The BoE was right to slow the unwinding of its economic support programme – aka quantitative tightening or QT -- but should have gone further, says Carsten Jung, economics director at the IPPR and a former Bank of England economist.
QT has "added unnecessary pressure on gilt yields at a time of global pressures", he says, so the Bank "should have in fact gone further and fully stopped active gilt sales, as these are not needed for its monetary policy strategy."
Seeing inflation as projected to ease, he says the MPC should also "more strongly signal how it intends to lower rates over the coming months, given a range of factors pointing to weaker demand".
1.03pm: Nvidia also gains on Intel deal
Nvidia’s shares are up 3% after it took a $5 billion investment in Intel, with the deal "less about money and more about influence", says analyst Matt Britzman at Hargreaves Lansdown.
"The deal deepens cooperation between two US chip giants, with Intel set to use Nvidia’s GPU technology and Nvidia gaining a stronger foothold in domestic chip production."
It is another welcome boost for Intel financially and strategically, he says, "as it leans on Nvidia to stay competitive" and follows another near-10% stake taken by the US government for $9 billion.
Even with these two new investors, Intel's US foundry business is struggling to attract the major customers it needs to succeed against the might of TSMC, Britzman adds.
"For Nvidia, the financial impact is small, but the political upside is big: this move aligns with US policy and could help ease restrictions on selling advanced chips to China.
"It also signals a shift in industry dynamics, with Arm losing some exclusivity and AMD facing more pressure. In short, this is a strategic alliance with geopolitical undertones, not just a balance-sheet transaction."
12.37pm: Intel rockets on Nvidia deal
Looking across the pond, Intel Corp (NASDAQ:INTC) shares have rocketed 28% premarket after announcing a deal with Nvidia Corp (NASDAQ:NVDA, ETR:NVD) in data centres and PC products.
As part of the deal, Nvidia will buy $5 billion of Intel shares for $23.28 apiece, while the pair have agreed to jointly develop "multiple generations of custom datacenter and PC products that accelerate applications and workloads across hyperscale, enterprise and consumer markets".
Nvidia CEO Jensen Huang says the collaboration "tightly couples Nvidia’s AI and accelerated computing stack with Intel’s CPUs and the vast x86 ecosystems [and...] lay the foundation for the next era of computing".
Elsewhere, one for runners and cyclists that like to track and share their progress: Strava is reported to be preparing to hire investment banks for an upcoming US initial public offering.
A $2.2 billion valuation was reported by Reuters, after a funding round completed in May.
12.19pm: BoE analysis
Some analysis of the BoE announcement.
"With inflation heading in the wrong direction, there was no question that the Bank would be on hold today," says economist George Brown at Schroders.
While markets are betting on rate cuts resuming next year, he remain "doubtful this will materialise", given persistent domestic inflationary pressures.
"A slowdown in quantitative tightening from £100 billion was clearly flagged, the only question would be to what extent.
"The Bank's announcement that it will allow £70 billion of gilts to roll off its balance sheet was broadly in line with our expectations, albeit meaning that active gilt sales will have to step up to £21 billion."
Brad Holland, director of investment strategy at Nutmeg, says markets are "not fully discounting the next rate cut until April 2026"
On scaling back quantitative tightening, he said "this matters because the bond curve on long-dated gilts steepened over the summer and there are growing fears that further bond sales from the Bank could increase losses and trigger a further steepening of the curve".
For the Rachel Reeves and HM Treasury, any steepening of the curve has an impact on government borrowing.
"These concerns have clearly motivated policymakers to re-examine its programme of bond sales as part of its annual assessment and slowdown sales.
"Whether this proves to be a silver lining for the Treasury or not, we will need to wait and see if this loosening shifts the scales and leads to a decline in gilt yields. The jury is out for now."
12.13pm: Gradual and careful approach
The language used in the BoE's announcement of its decision largely remained unchanged too, as far as I can see, with a "gradual and careful approach" to further rate cuts seen to be the appropriate approach.
"The timing and pace of future reductions in the restrictiveness of policy will depend on the extent to which underlying disinflationary pressures continue to ease.
"Monetary policy is not on a pre-set path, and the Committee will remain responsive to the accumulation of evidence."
On gilt purchases, the Bank plans to hold four gilt auctions in the fourth quarter of 2025, including two short-term auctions of £775 million each, two medium-term auctions of £750 million each, and one long-term auction of £550 million.
12.04pm: BoE holds
The Bank of England kept interest rates unchanged at its meeting on Thursday, as expected, with the monetary policy committee voting by a majority of 7–2 to hold the base rate at 4%.
Two MPC members voted to reduce the rate to 3.75%.
Policymakers also voted by the majority to ease the pace of quantitative tightening (QT), reducing the stock of UK government bond purchases held for monetary policy purposes by £70 billion over the next 12 months.
11.43am: BoE expected to hold, but slow down QT
The FTSE 100 and 250 are lagging their mainland European counterparts, "taking a more cautious tone ahead of today’s Bank of England rate decision", says market analyst Joshua Mahony at Rostro.
"Coming in a week that has already seen the Bank of Canada, Norges Bank, and Federal Reserve cut rates, UK borrowers are unlikely to enjoy the same treatment today."
The BoE's monetary policy committee is widely expected to keep rates steady for the remainder of 2025 as inflation levels remain well above the 2% target, though there are one or two economists and others who see potential for one more cut if the macroeconomics moves a certain way.
"Nonetheless, in a week that brings a raft of key data points out of the UK, the mix of higher claimants and falling core inflation could at least help push the narrative that the bank will need to become more accommodative if that trend persists."
Mahony says today’s meeting is likely to place greater emphasis on the bank’s quantitative tightening programme, which could be good news for Chancellor Rachel Reeves.
"With the BoE having to rely more heavily on active gilt sales to achieve reductions to its balance sheet, expectations are that it will signal a significant slowdown in the pace of QT.
"For markets, a slower withdrawal of liquidity could ease some upward pressure on gilt yields, while also weighing on sterling if investors read it as a more dovish tilt in policy."
11.17am: Inchcape lifted by UBS note
Shares in car distributor Inchcape PLC (LSE:INCH) are revving up 4% after UBS started coverage with a bullish rating and punchy valuation.
A price target of 920p implies plenty of potential upside from the 689p it has reached today.
The Swiss bank's pitch is straightforward: this is a dull but dependable distribution machine, trading on less than eight times earnings and paying a healthy stream of cash back to investors.
10.38am: Australia weakness hits Saatchi
M&C Saatchi PLC (AIM:SAA) shares fell 6% after the ad group warned that it expects LFL revenue to fall by mid-single digits this year.
This is based on "continuing macro headwinds as well as the significant drag of the Australian business", despite a improving momentum in its pipeline of opportunities.
CEO Zaid Al-Qassab says: "After a solid start to the year, we have not been immune to the market conditions of the wider industry, as clients reacted cautiously to the geopolitical tensions and the unstable macro-economic environment.
"This particularly impacted our Australian business, which subsequently had an adverse effect on the group's first half results."
10.11am: ONS says consumer spending stable
Consumer spending stabilised in August, higher than a year ago, according to the Office for National Statistics.
This was driven by increases in essential spending, such as utilities and mortgage repayments, based on its latest weekly ‘real-time indicators’ and fortnightly business insights survey.
Seasonally adjusted spending by Revolut debit card user was broadly unchanged in August compared with the previous month.
Total direct debit average transaction amount remained broadly unchanged in August 2025 compared with the previous month, led by loan payments (3%) and water bills (2%). Compared to a year ago DDs increased 2%, with the largest increase being water, which rose 26%.
Average prices for automotive fuel increased by 2 percentage points in August compared with the previous month, while the growth rate for average fuel demand per transaction remained broadly unchanged.
Compared to 2024, the annual growth rate for the average price of automotive fuel decreased 4 percentage points while the growth rate for average automotive fuel demand per transaction increased by 3 percentage points.
9.28am: European stocks surge
The FTSE 100 is bustling higher, bit by bit, with no standout gains but more of a general rising-tide feel, with only three of the index's top 15 largest companies in the red.
Down on the FTSE 250, there was a dip into negative territory, as Pets at Home dogs the mid-cap index, but it is padding slightly higher now.
Mainland European markets are showing stronger rises, with Germany's DAX and France's CAC both up around 1%, while the euro has recovered from its earlier slip.
Similarly, the pound is now steadier at $1.3627.
"Markets are responding to the US central bank rate decision," says analyst Patrick Munnelly at Tickmill Group, following the widely anticipated 25 basis point rate cut overnight.
"For those keeping score: the Bank of Canada reduced rates, the People's Bank of China maintained its position, the Hong Kong Monetary Authority had to align with the Fed, the Bank of England will announce later today, and the Bank of Japan will follow suit tomorrow."
The gains in Europe and Asia this morning is a "risk-on posture".
Neil Wilson at Saxo says the Fed's "fiscal dominance in action [...] means higher inflation, and is good for gold and bad for USD and long-dated Treasuries. It's gonna be a more mixed picture for stocks."
Gold is down 0.1% so far this morning at $3,656.
8.59am: Next down due to cautious views, say analysts
Next interims were in line with expectations, says analyst John Stevenson at Peel Hunt, with no changes to guidance.
Adjusted PBT came in slightly ahead of his forecast, with the first half seeing previous upgrades each quarter, reflecting favourable weather conditions and disruption at M&S.
"On this point, Next notes a 12% increase in non-credit customers this half, much higher than normal.
"Overall, this is a confident statement, tempered by concerns over a stagnant UK economy. The benefits of increased warehouse efficiency and online capability is clearly driving profitability, with international and wholly owned brand and licenses making a significant contribution to growth."
Adam Cochrane at Deutsche Bank says PBT was "slightly ahead of consensus £507 million" and on guidance "no upgrade was expected (other than some hope value) in our view given the upgrade to guidance in early August".
He notes that Next provided no update on current trading, with "still uncertainty on the horizon".
"The cautious view from the company on the UK is largely as expected but we still see the shares as trading down LSD% [low single digit] today on the lack of any material news on current trading or PBT upgrade."
8.31am: Pets at Home plunges
Pets at Home Group PLC (LSE:PETS) shares have plunged 18% after the retailer said CEO Lyssa McGowan has left the business with immediate effect and that it expects lower profit this year than it had guided previously.
Underlying profit before tax is now expected to be in the range of £90-100 million, down from £110-120 million guidance in July and £115-125 million in May.
Chair Ian Burke has taken on the role of executive chair in the interim, while a permanent CEO is being sought to replace McGowan, who had been CEO since 2022.
The past quarter has seen the market remain "subdued", as it had stated in its last update in July, and the rate of improvement in the Pets stores has been below expectations.
8.15am: FTSE ambles higher, despite Next tumble
The FTSE 100 has ambled higher in initial trades, adding 16 points to reach 9,224.
This is despite a 5% fall for Next, after its results seemed to dash some investors hopes.
Centrica and Unite Group are lower as their shares are ex-dividend.
Top risers are 3i Group, Rolls-Royce, RELX and tech trusts Polar Capital Technology and Scottish Mortgage.
7.58am: Renishaw sees further steady growth
On the FTSE 250, we have results Renishaw PLC (LSE:RSW) for the year to June, showing reported record revenue and profits at the top end of guidance for the year to June, with the markets it sells into (notably semiconductors) heading for "further steady growth" in the year ahead.
The maker of precision measuring and manufacturing tools generated £713 million of revenue, up 3.1% from the prior year, while adjusted profit before tax rose 3.8% to £127.2 million.
CEO Will Lee said the FTSE 250 group continued to see rising demand from the semiconductor manufacturing equipment market, counterbalanced by lower demand from the automotive sector.
Looking at current and forward prospects, he said: "Despite the continued global uncertainty, the structural drivers that underpin our markets are presenting growth opportunities across our businesses and at this stage we are expecting to achieve further steady revenue growth in the year ahead."
7.48am: Next returns
Next also declared a dividend of 87p per share, slightly higher than expected.
It has circa £351 million of surplus cash, as things stand, which it said "will either be used to buyback shares, returned as a special dividend, or invested in acquisitions".
No buybacks were completed in the second quarter because the share price remained above its buyback limit.
7.39am: Next is cautious about UK economic outlook
Shock horror, Next PLC (LSE:NXT) has left its guidance unchanged.
The clothing retailer reported a 13.8% increase in first-half profit before tax to £515 million as total group sales rose 10.3% to £3.25 billion.
CEO Simon Wolfson said: "In spite of the challenges presented by the UK economy, Next is in a good place, with multiple opportunities for growth, both in the UK and overseas.
"Our enthusiasm is tempered by the knowledge that the first half was boosted by factors that are unlikely to continue, and the belief that the UK economy is likely to weaken going forward."
7.26am: Some Fed analysis
Some thoughts from the City after last night saw the Fed's Federal Open Market Committee deliver its first rate cut of 2025, lowering the fed funds rate by 25 basis point to 4.00-4.25%, as expected.
Deutsche Bank macro strategist Jim Reid notes that Fed chair Jerome Powell described the decision as a "risk-management cut".
That left markets "feeling less confident on the extent of the likely easing cycle and Treasury yields were higher across the curve by the close with US equities flattish after a choppy post FOMC last couple of hours of trading".
The Fed’s 'dot plot' of all FOMC members' expected rate cuts resulted in the median narrowly shifting from 50bps to 75bps of total cuts for 2025, implying another 25bps cut at each of the remaining two meetings.
The 2026 and 2027 median dots were also 25bps lower at 3.4% and 3.1% respectively, Reid says, even as median growth and inflation projections for 2026 were both revised slightly higher.
"This suggested a more dovish Fed reaction function to the evolving balance of risks, and in the press conference chair Powell said it was 'risks that we’re seeing to the labour market' that drove the rate cut as the labour market could no longer be described as 'solid'."
Analyst Ipek Ozkardeskaya at Swissquote Bank says the details of the 'dot plot' are worth pointing out, with six members expecting no further change, two actually pencilling in a rate hike, while nine members see more than just a quarter-point of easing next year, of which two of them project cuts of up to a full percentage point.
"In short, the median suggests that Trump won’t get the deep cuts he’s called for — the Fed is not bowing to political pressure. That’s reassuring."
She says markets "weren’t sure how to take the news", with the S&P 500 swinging lower before paring losses, the Russell 2000 surged but then erased most of its gains.
The US 2-year Treasury yield rebounded and the dollar index bounced from a fresh yearly low.
"Today’s session will be key to gauge whether risk appetite holds. Early signs are positive: US and European futures point higher, suggesting that a reasonably dovish Fed, combined with stronger earnings prospects, looser financial conditions and a weaker dollar, keeps risk assets in a sweet spot," she says.
7.15am: FTSE predicted for another quiet start
FTSE 100 futures are indicating a modest gain for Thursday after the US Federal Reserve cut rates by a quarter of a percent last night and ahead of the Bank of England meeting later today.
The main US stock indices and US Treasury yields all wobbled during the follow-up Fed press conference but ultimately all ended up pretty much where they were earlier in the day, which was a 0.6% rise for the Dow Jones, a 0.3% fall for the Nasdaq and a 0.1% decline for the S&P 500.
The US dollar started to reverse its recent slide, with the pound and euro both down around 0.25%.
London's blue-chip index has been called about four points higher, a day after adding almost 13 points to end at 9,208.37.
Asian markets are mixed this morning, with Japan's Nikkei and India's Sensex climbing 1.25% and 0.4% respectively, Hong Kong's Hang Seng and the Shanghai Composite falling 1.1% and 0.5%.