- FTSE 100 falls 69 points to 10,402
- UK GDP growth remains lacklustre at 0.1%
- Schroders family agrees takeover offer from Nuveen
- BAT, Unilever, Magnum Ice Cream report results
5.05pm: FTSE falters
The FTSE 100 pulled back from Wednesday’s record high close to finish the day down 69 points at 10,402.
“The FTSE 100 has shed ground today despite its new record high, weighed down by losses for BP,” IG’s Chris Beauchamp said. “Caught between payrolls and CPI, US markets have found themselves unable to maintain momentum, though European stocks are continuing to trounce their US peers, as the CAC40 hits a new record high.”
4pm: Into the red
The FTSE has been dragged further into the red as we near the close. Having hit a new record high earlier, it has been weighed down by losses for BP and Shell.
Chris Beauchamp, market analyst at IG. syus: “The US might be poised to send a second carrier to the Middle East, but with a month until it arrives it still looks like President Trump remains circumspect at best about direct military action. Positioning in oil continues to become less bearish, but without a firm catalyst this rally might well run out of steam very quickly.”
3.21pm:
Looking at US movers, AppLovin shares have tumbled 16%, despite the mobile advertising software company reporting stronger-than-expected fourth-quarter earnings and raising its outlook for 2026.
McDonald's is up 2% after posting fourth-quarter revenue and comparable sales that exceeded analysts’ expectations, driven by its US traffic and the continued popularity of value meals.
Revenue rose 10% year-on-year to $7.01 billion, surpassing the $6.81 billion forecast, while earnings per share matched estimates at $3.03, up from $2.80 a year earlier.
Fastly surged nearly 64% after the edge cloud company reported fourth quarter results and issued guidance that topped Wall Street expectations.
For the fourth quarter of 2025, Fastly reported adjusted earnings of $0.12 per share, beating the consensus estimate of $0.06.
2.46pm: US stocks uneven, FTSE in the red
US stocks have seen another uneven start.
The Dow Jones and S&P 500 have opened 0.4% and 0.2% higher, but the Nasdaq has slumped into the red after a slightly positive start.
Bigger losers on the Nasdaq include Applovin falling 13.5%, Cisco down 7%, Netflix 2.25% and Apple down 0.8%.
Top of the Dow are Goldman Sachs, Walmart and Salesforce, all up over 1.5%.
Back in London, the FTSE has slipped into negative territory, with BP down 2.9%, Shell falling 1%, and Unilever, BAT, and Stan Chart all down at least 1%.
1.27pm: BoE's Breeden talks rate cuts
Bank of England policymaker Sarah Breeden has said today that a rate cut could come in the next couple of meetings, which are on 19 March and 30 April.
"If we continue to have the economy develop as we expected and if there are no shocks – to be clear those are two big ifs… I think it’s reasonable to expect there to be a cut over the next couple of meetings," she told an audience in Manchester.
Breeden, deputy governor for financial stability for the BoE and a member of its monetary policy committee, was in the North West to speak to business leaders.
She told the BusinessLive website that members of the MPC are looking at "where is inflation going to be in the medium term".
The most recent BoE staff forecasts calculated that inflation is going to hit the BoE's 2% target earlier than expected, around April, and that it should stay close to there for the foreseeable.
“But of course there are risks around that outlook and so our debate around the MPC table was about the upside risk to inflation, if we continue to have high wages, if they are fuelling increases in prices.
"On the upside – are we having inflation persistence continuing; versus the risk to the downside – are we going to see a pick-up in activity as we're expecting? Might there be more of a loosening in the labour market and might that bring inflation below target?"
She says she has been more focused on downside risks and "wasn't confident that we're going to see that pick-up in activity and so I thought it was appropriate for us to take our foot off the monetary brake a little bit and provide a bit more support for the economy".
At the last meeting, Breeden was one of four voting for a cut, with the majority wanting to hold rates steady.
12.24pm: Mid-caps lifted by financial sector
London's mid-caps are outperforming the blue chips this morning, a rare sight in the past 18 months and especially as FTSE 100-listed Schroders is up almost 29%.
The FTSE 250 is up 0.5%, while its larger sibling is up just 0.1%, held back by some sizable falls among some of the largest companies in the index, with Unilever down 1.45%, BAT falling 2.3%, while BP is down 1.4%.
Mid-cap financials are bouncing back a bit from their AI selloff yesterday, helped by the supportive thoughts from the City (see comments at 9.43am) and read-across from Schroders.
Funding Circle, Aberdeen Group, Man Group, AJ Bell, Molten Ventures, Mony Group, Close Brothers Group, IntegraFin, CMC Markets, Bridgepoint and ICG.
Looking across the Atlantic, US stock futures are moderately positive at the moment.
Futures for the Dow Jones, S&P 500 and Nasdaq 100 are all up around 0.3%.
11.47am: Political changes and how they could affect the economy
After the lacklustre GDP growth in the second half of last year, UK political instability is one of the biggest risks for the UK economy, says Thomas Pugh, chief economist at RSM UK.
This is with the odds that Keir Starmer is replaced as PM by year-end have risen from roughly 50% at the start of the month to almost 70%.
"A change in leadership now feels more like when, than if. For the UK economy, that raises three near-term risks: a spike in uncertainty, higher gilt yields, and potentially another round of tax or borrowing increases," says Pugh.
"Any leadership challenge would likely lead to a surge in policy uncertainty," he adds, with candidates needing to spell out how their fiscal approach differs, "reopening Pandora’s box of tax rises" and risking a further dent to consumer confidence and business sentiment.
"The scale of the damage will depend on the tone of the contest. A short, relatively civil skirmish, with limited policy divergence, would contain the fallout. A prolonged, noisy brawl, with meaningful tax and borrowing increases on the table, would be far more damaging."
He says this would be "particularly unfortunate given mounting evidence that the economy has started to turn a corner, as last year’s budget uncertainty fades".
Any suggestion by leadership candidates of rewriting the fiscal rules or diluting the role of the OBR would be likely to push gilt yields higher.
Any more Bank of England rate cuts could pull down gilt yields and ease borrowing costs for households and firms, he adds, supporting activity and reducing the pressure for further tax rises.
"But if political risk keeps gilt yields elevated, rate cuts may not fully feed through to funding costs. Monetary easing would be partially offset by higher term premia."
Looking further ahead, he sees a change in leadership resulting in looser fiscal policy, with the UK one of the only developed economies on a path of fiscal consolidation, with the budget deficit set to fall from around 4.5% this year to 2% by 2029/30.
"One option would be to change the fiscal rules to allow a much slower fiscal consolidation. Another would be to backload even further tax rises into the next parliament. Given the relatively sanguine response from markets to November’s backload budget, this is probably the most likely option."
11.16am: IEA cuts forecast for oil demand growth
The International Energy Agency lowered its estimate for the growth of oil demand this year as it warned the global market still faces a large supply surplus.
In its monthly oil report, the IEA projected that global supply would exceed demand by 3.73 million barrels per day in 2026, little changed from what it said last month and equivalent to around 4% of global demand.
Other bodies have calculated a smaller surplus.
The IEA's new forecast sees demand of to 850,000 barrels per day in 2026, from 770,000 barrels/day in 2025 but moderately lower than its previous estimate due to “economic uncertainties and higher oil prices" weighing on consumption.
Oil supply is expected by the agency to bounce back in the coming months, after an "exceptional" plunge last month as extreme winter weather in North America and ongoing disruptions in Kazakhstan hit supply.
10.57am: Records all round
As well as the FTSE hitting new intraday heights, France's CAC 40, the Stoxx 600 and Stoxx 50 have also hit record highs this morning.
Germany's DAX is up 1.4%, bouncing back from yesterday, with Siemens and Commerzbank leading the gains.
In London, various sectors are giving a lift to the index: banks, other financials, housebuilders, miners, insurers and airlines.
Unilever is down 0.7% after its results.
Market analyst Victoria Scholar at Interactive Investor says underlying operating profits were slightly below expectations, while guidance for 2026 sales growth is at the bottom end of its medium-term range.
On a more positive note is the share buyback and fourth quarter underlying sales growth of 4.2% beat forecasts for 3.9%.
"Although Unilever achieved a robust set of quarterly earnings and is returning cash to shareholders, investors have failed to get enthused by today’s report, with focus on its disappointing outlook sending shares into the red," she says.
"This year is likely to be critical for Unilever as it attempts to demonstrate strength in its new life without its ice cream business. However, the sales forecast is less than encouraging and suggests it could be a bumpy road ahead, particularly in its more saturated developed markets like the US and Europe where growth has slowed.
"Unilever is expected to make changes, including ‘targeted disposals’ and ‘bolt on deals’ to focus on its core winning 'power brands'."
BAT is down 1.3% after its final results.
Analyst Derren Nathan at Hargreaves Lansdown says the numbers "mirrored recent guidance as well as a mix of challenges and progress made over 2025".
While smokeless products grew their revenue share, led by 48% growth in the nicotine pouch category, vapes continue to drag on performance due to illegal competition.
"The operating margin is improving, but is still wafer-thin when compared to combustibles," says Nathan.
"Weaning the company off cigarettes is proving harder than originally anticipated, which is also reflected in unchanged guidance coming in at the lower end of the medium-term target range. There’s more work to be done to drive the shares higher from these levels."
10.18am: Some movers
Morgan Sindall Group shares are up 7% after the construction and regeneration group flagged stronger-than-expected performance in its Fit Out division in an unscheduled trading update. The company said trading in 2025, due to be reported in full on later this month, was in line with current market expectations.
Elsewhere, Genflow Biosciences has woofed 19.5% higher after the company reported positive preliminary results from its clinical trial in aged dogs. The London-listed biotechnology group, which develops gene therapies for age-related diseases, said treated animals showed improved survival and functional outcomes during the dosing period.
Sancus Lending shares soared 53% to levels last seen in early 2023 after the AIM-listed specialist property lender agreed to increase and extend its credit facility with Pollen Street Capital. Sancus said it had entered into definitive legal agreements to expand the size of the facility from £200 million to £300 million, intended to support growth for its UK and Ireland arms.
9.43am: Is this week's AI selloff for SJP, AJ Bell and Quilter overdone?
Analysts at UBS, Citi and JPMorgan are offering up their thoughts on the AI sell-off this week in financial platforms and brokers from St James's Place, to AJ Bell, IG, Quilter and Integrafin.
Citi says the sell-off was unwarranted, arguing that stand-alone robo-advice businesses have historically struggled to scale and that artificial intelligence tools are more likely to benefit existing adviser networks and direct-to-consumer platforms than disrupt them.
The US bank expects AI to lower the unit cost of advice, which could drive greater adoption from currently low levels, while productivity gains help offset pricing pressure.
UBS analyst Haley Tam says the main risks are that AI "could make it easier to compare broker pricing where the underlying product is commoditised".
Brokers and fund platforms that charge consumers the highest prices "may see more risk and higher switching volumes than in the past", she says.
"AI is an efficiency tool," she says, another likely disruption that seems to be as likely from within the industry as from outside.
"We have seen this movie before. Robo-advice has been long awaited but not really taken off. This time it may be different, but there will likely still be value in meeting advisers and the human touch."
Tam sees potentially more vulnerable business models at advice or advice-exposed firms like St James's Place, Quilter, AJ Bell and Aberdeen.
JPMorgan also chips in: "While we believe that the market generally underestimates the importance that clients of financial advisers place on the personal relationship with their advisers, we note that different market structures across regions could lead to different levels of penetration of AI solutions, and we believe that financial advice firms will have to be proactive in adjusting their business models to cater for the needs of younger cohorts of clients, who are more likely to use technology to manage their finances, and are the recipients of the ongoing generational transfer of wealth."
9.21am: Schroders a missed opportunity for markets
Nuveen is getting a pretty good deal for Schroders, suggests analyst Rae Maile at Panmure Liberum.
"We had a note ready to outline how well the company had done, how quickly management had delivered change, how much more upside there was to come as the market started to fully appreciate all that had happened in just 15 months.
"Instead Nuveen will take the spoils, offering 612p per share, only a touch ahead of where we might have been pitching a new target price in an independent world.
"With the offer being recommended the family has clearly decided to move on, but the rest of us will be poorer for it."
9am: Savills down
Savills shares are down 8%, Foxtons is down 2.75% - neither have any news out so it could be to do with the RICS data out this morning.
However the residential market survey for January pointed to an improving housing market.
As Panmure Liberum analyst Adrian Kearsey says: "While most of the data points are still under the water, they are less negative than they were.
"Given the survey covered the period merely two months after the November Budget, we see these recordings as encouraging."
His conclusion is: "important not to get too excited but explains why Bellway and Barratt Redrow this week delivered 'maintaining guidance' updates."
8.39am: GDP to bounce back in Q1
Some thoughts on the GDP figures.
James Smith at ING says the economy ended 2025 "on a lacklustre note, not that it was a huge surprise".
"What’s particularly eye-catching from the release is just how weak business investment (-2.7%) and construction (-2.1%) came in."
The former will have been heavily influenced by volatile car production, linked to the JLR cyberattack in August, Smith says, "even if it’s tempting to blame it on the wider uncertainty in the run-up to the budget and the weakness in confidence".
Construction weakness "is a reminder that past Bank of England rate hikes are still biting".
He says he is taking GDP figures with a grain of salt as "growth has become suspiciously seasonal", with the first half of the year looking much stronger than the second every year since 2022.
"Though hard to pin down, we suspect it’s partly down to higher inflation, the prevalence of price hikes early on in the year, which are not being fully adjusted for in the deflator/seasonal adjustment process somewhere along the line. There’s no reason to think this trend will stop in 2026 and if for no other reason, we suspect we’ll get a bit of a bounce back in Q1 GDP."
Matt Swannell at the EY ITEM Club has a different take on the seasonality theme: "In recent years, the economy has regularly lost momentum in the middle of the year, before regathering pace through the turn of the year, indicating that the activity estimates from the Office for National Statistics (ONS) continue to suffer from residual seasonality.
"Early indications are that growth will pick up in the first quarter of this year, boosted by that residual seasonality.
"Although growth is expected to pick up in Q1, 2026 is likely to be another year of sluggish UK growth. Ongoing uncertainty and weak profitability are likely to weigh on business sentiment and investment spending. Meanwhile, continued fiscal tightening and slowing real income growth will present powerful headwinds to growth."
8.15am: FTSE 100 opens above 10,500
The FTSE 100 has climbed into virgin territory in opening trades, rising 40 to cross the 10,500 mark for the first time.
Schroders is leading the way, up 29%, after agreeing to be taken over by a US rival.
Financial services peers have been given a lift by this news, with St James's Place up 3.5%, with LSEG, Pershing Square, ICG, Experian and Lloyds Banking all up either side of 2%.
7.55am: BAT hikes buyback
British American Tobacco announced an increased £1.3 billion share buyback for 2026 as results for last year beat City forecasts by a cigarette paper, but growth expectations for the coming year were dampened down.
Adjusted operating profit rose 2.3% to £11.57 billion in the 2025 calendar year, just ahead of market expectations of £11.45 billion. Adjusted diluted earnings per share of 352p also beat forecasts of 340p.
Reported revenue fell 1.0% due to currency headwinds but rose 2.1% at constant exchange rates, with growth driven by cigarette sales and its Velo Plus nicotine pouches in the US.
For 2026, the group expects performance at the lower end of its medium-term ranges.
7.40am: Unilever reports stronger sales momentum, but lower profits
Unilever is sprinkling a €1.5 billion share buyback on top of its results for last year, as the consumer goods group reported improved sales momentum and expanding profit margins after spinning off its ice cream arm.
The owner of brands ranging from Marmite and Pot Noodle to Persil and Lynx posted results showing underlying sales growth of 3.5% for the year, thanks to a stronger fourth quarter, where USG rose 4.2%.
Underlying operating profit fell 1.1% to €10.1 billion, even though underlying operating margin widened by 60 basis points to 20.0%, driven by tighter overhead control.
For 2026, the group expects underlying sales growth of between 4% and 6%, with at least 2% volume growth, and a modest margin improvement.
7.25am: Schroders agrees to be bought by US peer
Schroders PLC has agreed to a £9.9 billion cash takeover by US-based Nuveen in a deal that will create one of the world’s largest active asset managers.
Under the terms of the recommended offer, Schroders shareholders will receive 590p in cash per share, plus permitted dividends of up to 22p, making a total of 612p.
The cash element represents a 29% premium to Wednesday’s closing price and a 55% premium to the 12-month average, representing a level for the shares last seen in 2021.
If dividends are paid in full, the deal values Schroders at about £9.9 billion and implies a multiple of 17 times adjusted operating profit after tax for 2025.
Nuveen, which is the investment management arm of US retirement giant TIAA, has already secured irrevocable undertakings from the Schroder family, which holds 42% of the shares.
7.16am: FTSE 100 set to open at record high
The FTSE 100 is set to ascend to new record territory on Thursday after new data showed the UK economy grew more slowly than expected at the final quarter of last year.
London's blue-chip index has been called 49 points higher on the futures market, a day after it soared over 118 points to a record closing high of 10,472.11.
It was a different story on the Continent and in the US, with the German, French and Italian benchmarks falling between 0.2% and 0.6%, while on Wall Street the Dow Jones retreated 0.1% from its record high, and the Nasdaq also fell 0.1%, with the S&P 500 closer to flat.
This morning, the Office for National Statistics revealed that UK gross domestic product grew 0.1% in the fourth quarter of 2025 compared to the third quarter, the same as in Q3 but below the4 0.2% average forecast.
Year-on-year, GDP expanded 1.0%, down from 1.2% and below the 1.2% consensus estimate.