- FTSE 100 down 9 points to 10,428
- US and Asian big tech sells off
- SpaceX falls 16% after launching $20bn bond sale
- UK 'flash' PMI worse than expected for June
5.30pm: Muted day for London stocks
The FTSE 100 finished the day slightly lower than where it started, down 9 points at 10,428. Across the Atlantic, a sharp drop in SpaceX weighed on other tech stocks.
“SpaceX shedding more than $600 billion in value and over 30% from its post IPO peak, marks one of the most dramatic reversals ever seen in a newly listed mega-cap stock, dragging the whole technology sector down with it,” IG chief technical analyst Axel Rudolph said.
“The South Korean Kospi - down 10% on the day - and Nasdaq 100 continue this week's rout with the latter dropping by another 2.5% while non-technology indices like the Dow and FTSE 100 benefit from sector rotation, helping these outperform.”
4.17pm: FTSE fights back
Bunzl, up 5.4%, is leading the pack as the FTSE has wrestled its way into positive territory this afternoon, after starting with over a 100-point deficit in early trading.
The index's stable of consumer-facing defensives is also helping, with BAT, Diageo, BAT Group, Babcock, AstraZeneca, GSK, Unilever, M&S all up 3.4-1.3%.
Miners and tech funds remain the big drag, with Antofagasta, Anglo American, Glencore, Fresnillo, Polar Capital Tech and Scottish Mortgage at the bottom of the table.
Other European and US markets remain in the red, with the DAX down 0.8% and the CAC 40 off 0.4% over the Channel, while across the Atlantic, the Nasdaq is down 1.85% and the S&P 1.2% lower. At best, some indices are flat, like the Dow and IBEX.
3.47pm: Ibstock, Wizz and Greggs most shorted FTSE stocks
Ibstock remains the most shorted stock on the LSE, with 24.8% of its shares on loan to investors betting on a decline in the brickmaker's share price, according to the latest data from S&P Global Market Intelligence.
This has risen from 20.6% in April and 20.3% in May.
It has taken over from Wizz Air, which is now the second most shorted stock at 19.1%, down from 24.1% and 23.9% in April and May. Greggs is next on 17.3%, having also seen a significant reduction from 23% in April.
Travis Perkins (LSE:TPK) is up on 14.6%, a new entry in the top 10, with housebuilders also a target for bearish investors, with Taylor Wimpey also a new entry, while Vistry's short interest has been on the rise.
Across the wider market, 1.3% of FTSE 100 market capitalisation and 2.0% of FTSE 250 market capitalisation is currently out on loan, S&P said.
Earlier in the week, it said Magnum Ice Cream was the most shorted European stock, with 12.2% out on loan, followed by takeaway platform Delivery Hero (XETRA:DHER, OTCQX:DLVHF), ingredients giant DSM-Firmenich and Dulux paint owner Akzo Nobel.
3.19pm: IP confirms it rejected bids from major shareholder
IP Group has confirmed it rejected three takeover proposals from one of its largest shareholders, the railways pension scheme Railpen.
The board said the last proposal was received on 16 June, a "draft indicative final offer letter" at an implied value of 69.5p per IP share.
Railpen had described the offer as final, though the label carries no force under the takeover code.
The proposal comprised 59p per share in cash, plus the indirect value of IP Group's stake in Oxford Nanopore Technologies, distributed as a dividend.
Michael Queen, Chair of IP Group said: "While the board remains confident in the company's standalone prospects, it will continue to act in the best interests of all shareholders and wider stakeholders, and remains open to engagement with any party that recognises the inherent value of IP Group's unique portfolio."
3pm: AI stocks sell off
The Nasdaq has led an opening decline on Wall Street, slipping down 1.5% to add to yesterday's 1.3% drop.
The S&P 500 has slid just over 1% and the Dow Jones has slunk 0.3% lower so far.
Biggest fallers on the S&P are concentrated in the stocks that have led the AI and semiconductor rally.
It's almost entirely chipmakers, semiconductor equipment suppliers and AI infrastructure names: SanDisk is down 13.2%, followed by Micron, Corning, Lam Research, Teradyne and Applied Materials all down around 10% or more.
Other major semiconductor names including KLA, Qualcomm, ON Semiconductor, Texas Instruments, AMD, Analog Devices, Microchip and Intel are all down between 6% and 9%.
As for the Dow, Caterpillar is down 4%, with Honeywell, Goldman Sachs and Cisco following at nearer 1%, indicating investors are also rotating out of broader cyclical and industrial exposures.
2.06pm: STAN upgrade, Persimmon pressure seen
Some broker notes moving markets.
Standard Chartered has been the best-performing FTSE 350 banking share this afternoon after being upgraded to 'buy' by Deutsche Bank, which said the lender is better placed than peers to benefit from the rapid expansion of Asian wealth management.
Persimmon shares are down 2%, the biggest faller in the sector, as Citi said the housebuilder's current calendar year looks increasingly secure, but the bigger issue for investors is whether margins come under pressure in 2027.
RBC Capital Markets does not seem to think that Lloyds or Shawbrook should or will be able to buy Aldermore, putting a price tag of about £1.35 billion on the specialist lender, whose owners are exploring a sale.
RBC colleagues sees structural growth opportunities for Next and Marks & Spencer as the wider UK consumer outlook remains uncertain, but in different areas.
Elsewhere, UBS has said US investors' fear of missing out on a bull market rally has been the key recent driver of market gains, particularly for artificial intelligence stocks. Jason Draho, UBS's head of asset allocation for the Americas, argued that the economic backdrop should keep the bull market running.
Deutsche Bank says it is 'unsurprised' that IP Group rejected a take-private approach from Railpen, its largest shareholder.
1.34pm: Nasdaq set for sharper slide
US stocks look set for a sharply weaker open, with the sell-off in technology shares deepening.
Futures point to losses for the Nasdaq 100 of around 849 points, or 2.8%, while the S&P 500 is set to shed 1.3% and the Dow Jones to drop 0.4%.
The weakness follows a mixed session on Wall Street overnight, where the Dow rose 0.3%, but the S&P fell 0.4% and the Nasdaq lost 1.3%.
Daniela Hathorn, senior market analyst at Capital.com, reckons the decline in SpaceX has "weighed on broader confidence in high-growth, innovation-led stocks and reignited concerns that investors may have become overly concentrated in a small number of AI and technology themes".
"The selloff has encouraged some profit-taking across the sector, particularly after an extended rally that pushed some indices more than 30% higher from their April lows."
On a technical analysis basis, she says the "broader uptrend remains strong".
The Nasdaq is "testing the strength of dip-buying demand that has repeatedly supported the market this year. For now, the move looks more like a sentiment-driven correction than a fundamental shift in the AI and earnings narrative, but it highlights how dependent market leadership has become on a relatively small group of growth-focused stories."
12.27pm: FTSE still wallowing
Just before midday, the FTSE 100 had seen its losses cut to below 20 points, but now this is back out to a loss on the day of around 50 points again.
Offsetting the big weight from the declining miners, top of the leaderboard is Bunzl after its trading update.
However, at just over £8 billion market cap it's not doing much on its own.
There are some heavyweights contributing upward pressure, with RELX up 2.1%, BAT, AstraZeneca and BT all up over 1.7-1.3%.
11.58am: World Cup "importance" stressed for supermarkets
The earlier NIQ grocery market data (see 10.59am update) "revealed that trading patterns across the UK grocery scene were sound overall", says analyst Clive Black at Shore Capital.
Albeit, he notes that a strong initial 14-day period was followed by a flatter two weeks.
Sainsbury and Tesco are "facing into tough comparatives," but respective NIQ scores over two years are "sound to us", Black says.
Marks & Spencer "excels", with its 50%-owned Ocado Retail the fastest growing name. M&S "continues to perform very strongly in the food segment, suggesting to us that new space is performing well, whilst same store performance remains strong".
Ahead of its trading update at the end of the month, Sainsbury delivered good 3.5% 12-week growth. "We would be surprised to see any change to FY27 financial guidance," says Black.
Asda is continuing to lose market share, with sales down 4.5%, while discounter Aldi had "notably lower" like-for-like momentum.
Black concludes: "For the much of the UK grocery retail scene, Q2 CY26 is a bit of a slog, set against last year's sustained clement weather; hence, the importance of the FIFA World Cup to current trading momentum."
While M&S' food activities are excelling, he senses the UK apparel market is "trickier", whilst Sainsbury and Tesco "look to be grinding trade out satisfactorily, to us".
While the trade remains very competitive, Black notes that Tesco CEO Ken Murphy stated only last week it remains "rational", which is industry code for "no price war".
10.42am: FTSE outperforming
The FTSE 100 is down but has trimmed its losses and is far outperforming many mainland European markets.
Germany's DAX and Italy's FTSE MIB are the weakest performers, both falling 1.3%, while French and Spanish benchmarks are down 0.8% and 0.4%.
The Stoxx 600 is down 0.9%, led lower by technology, industrial and mining stocks. Lighting Signify has slumped more than 15% after an underwhelming strategy update, while semiconductor giants STMicroelectronics (NYSE:STM) and ASM International are next, along with Siemens Energy, Antofagasta and Fresnillo, all down more than 5%.
London's miners are lower "amid concern about the global economy", says analyst Russ Mould at AJ Bell.
As for the market reaction to the latest political news in the UK, it is "relatively measured" after Keir Starmer’s decision to step down as prime minister yesterday.
"Gilt yields held firm despite uncertainty around whether there will be a smooth succession for Starmer’s replacement or a leadership contest."
Saxo's Neil Wilson says markets are "still trying to figure out" what a likely Andy Burnham government means for the economy and markets.
"Who’s the chancellor is a big signal not just about the substance of their priorities but also the tone of the new regime in terms of just being about Burnham and supporters or a genuine reset."
The Times reported that Burnham will give an economic speech early next week, promising to reduce national debt and borrowing costs while setting out his growth plan within the current fiscal rules.
"We don’t know much about his actual economic plans... we should hear more next week in a speech, in which he will seek to reassure markets. So far he’s been walking back some of more leftward-lurch-type rhetoric…gilt markers will be happy if it’s Streeting, perturbed if Miliband, who’s clearly the least market friendly candidate for chancellor."
Wilson sees the biggest risk for UK assets being "if an emboldened Burnham (and why not be bold given the momentum?) makes 'brave' decisions (to borrow from Sir Humphrey) on tax and spending".
He says the selloff in tech shares that sent the Nasdaq down 1.3% and Korea's Kospi down 10% is a result of "widespread de-risking and deleveraging" as markets are "starting to wake up to the fact that the Fed could raise rates as early as July".
9.59am: Ocado, M&S, Sainsbury's and Tesco's sales grow
Britain's supermarkets enjoyed a weather and football-fuelled boost in early June, with two sources of industry data showing shoppers spent more on barbecues, drinks and promotions despite continued pressure on household finances.
NielsenIQ said supermarket sales rose 4.6% in the four weeks to 13 June, while separate figures from Worldpanel by Numerator (the former Kantar data) showed take-home grocery sales increased 2.4% in the four weeks to 14 June.
The UK's record May temperatures and the start of the FIFA Men's World Cup helped drive demand for seasonal products, with suncare sales jumping 128%, fresh beef burgers rising 40%, no- and low-alcohol drinks increasing 23%, while strong growth was seen in ice cream, soft drinks, lager and world cuisine categories.
Promotions remained a key battleground. NielsenIQ said 25% of FMCG sales were made on promotion, rising to 29% online, while Worldpanel found promotional spending reached 30.4% of grocery sales, extending a 39-month run of annual increases.
Among retailers, Ocado Retail remained the standout performer in both surveys, while Lidl continued to gain market share. Co-op also returned to growth, helped by easier comparisons following disruption from last year's cyberattack.
Tesco sales rose 1.2% over the 12 weeks to 14 June and market share holding at 28.0%, according to the Worldpanel data, while Sainsbury's outperformed the wider market with sales up 2.0%.
M&S remained one of the fastest-growing food retailers in NielsenIQ's survey, with sales up 14.3% over the 12 weeks to 13 June, reflecting continued momentum in its grocery business.
9.37am: UK flash PMI worse than expected
The UK 'flash' PMI is in now, showing private sector activity weakening for the second month in a row in June.
A 14-month low of 49.4 was seen for the preliminary reading of the composite PMI, down from the 49.7 final reading for May, and well below the 50.5 consensus forecast.
The services activity PMI dropped to 48.7 from 49.3, a new 41-month low, significantly below expectations of 50.1.
Manufacturing provided a brighter spot, with the manufacturing output index rising to a 21-month high of 53.6 from 52.2, marginally ahead of forecasts, though the headline manufacturing PMI eased to 53.1 from 53.9, a three-month low.
Economist Chris Williamson at S&P Global says the PMI indicates "the economy contracted for a second successive month, albeit at only a 0.1% rate and merely flat-lining over the second quarter as a whole".
He adds that price pressures "remain elevated as companies point to the energy shock and supply squeeze from the war in the Middle East as exacerbating existing cost pressures from government policies", though he says some war-related price pressures have started to moderate.
Employment continued to fall at "a worryingly high rate", he says.
"While current weakness is focused on consumer-facing services, an offsetting expansion of the manufacturing sector could soon falter, as demand here is being temporarily buoyed by the building of safety stocks amid ongoing war related supply worries."
9.26am: Eurozone PMI rises to 3-month high
Eurozone business activity improved in June, with the 'flash' composite purchasing managers' index (PMI) rising to a three-month high of 49.5 from 48.5 in May.
This beat expectations of 49.2 but remained just below the 50 level that separates growth from contraction.
The main improvement was services, where the PMI climbed to a three-month high of 48.9 from 47.7, ahead of the 48.6 consensus forecast.
The manufacturing PMI remained the stronger element, although momentum eased to a four-month low of 51.3 from 51.6 for the activity index, while the manufacturing output index edged down to a five-month low of 51.2 from 51.3.
There were signs that inflationary pressures are cooling.
S&P Global said: "Although input costs continued to rise rapidly during the month, the rate of inflation eased to the slowest since February, just before the outbreak of war in the Middle East."
The rate of output price inflation was also reported to have slowed in June, albeit to a lesser extent than was seen for input costs.
9.12am: FTSE 100 falls 100 points as miners hit
The FTSE 100 has seen selling pick up in the past half hour, taking the index down 99 points to 10,339.
Miners make up six of the top eight fallers, with tech investors Scottish Mortgage and Polar Cap Tech the others.
Among the largest blue-chips, all but three of the 15 largest names are in red, with HSBC and the other big banks as well as oilers Shell and BP all down, while Rolls-Royce and National Grid sit 2% and 1.3% lower.
Copper, gold, silver, oil, iron ore and other commodities are all lower this morning, amidst a stronger US dollar, which generally acts as a headwind for such assets as they become more expensive for international buyers.
8.57am: Pawnbroker snapped up
Shares in Ramsdens Holdings have jumped 28% after the pawnbroker agreed a recommended cash takeover by US rival FirstCash that values the UK group at up to around £206 million on a fully diluted basis.
Ramsdens shareholders will receive up to 609p a share, comprising 600p in cash plus permitted dividends of up to 9p.
The cash element represents a 33% premium to Ramsdens' closing price on the last business day before the offer period began.
8.39am: Telecom Plunge
Telecom Plus shares have plummeted 30.5% on the news that management plan to invest in growth, which will hit profits this year.
Analyst Charles Hall at house broker Peel Hunt says it is an "aggressive reset" by management, investing £55 million per year to double multi-service customers over the next five years.
He points to early results, with multi-service customer growth having "materially improved YTD (+9.7%), with partner numbers up 5% and activity accelerating (+15%)".
But the other impact is that he has reduced his PBT forecast for the current year by 39% to £85 million.
"We reduce our target price from 1,850p to 1,400p, but retain a 'buy' recommendation, given expectations of stronger multiservice customer growth."
8.15am: FTSE opens lower as miners and SpaceX investors fall
The FTSE 100 dropped around 80 points initially but this has quickly been pared to around 64, taking the index to just below 10,374 points.
Miners and tech investment funds are the main fallers, with precious metals miner Fresnillo bottom of the pile, down 6.1%.
Copper miners Antofagasta and Anglo American are down 4.8% and 3.7%, while gold miner Endeavour is down 3.2%.
Tech investor Scottish Mortgage, which has a big stake in SpaceX, has dropped 4.8% after the 16% decline in the rocket company overnight.
Rio Tinto, Polar Capital Tech Trust and Glencore have also all fallen around 3%.
7.56am: Telecom Plus unveils big investment plan
Telecom Plus has reported record annual results and unveiled a big investment plan aiming to more than double its number of multi-service customers to over a million by the 2031 financial year.
The FTSE 250 company, which trades as Utility Warehouse, revealed that adjusted pre-tax profit increased 4.7% to £132.2 million in the year to March, on revenue up 5.6% at £1.94 billion.
In a separate statement, it revealed plans to invest about £55 million a year to expand its multi-service offering, grow its network of local referrers, build brand awareness and improve its digital platform.
The strategy is designed to increase the number and proportion of customers taking multiple services, which generate higher returns and remain with the business for longer.
While it is targeting adjusted pre-tax profit of about £175 million by the 2031 financial year with shareholder distributions of around £100 million a year, the investment will weigh on near-term earnings, with adjusted pre-tax profit expected to fall to £80-90 million in the current financial year.
7.38am: Bunzl upgrades outlook
Bunzl has upgraded its outlook for the current financial year after reporting stronger-than-expected trading in the first half and completing a small acquisition in Australia.
The FTSE 100 distributor said revenue in the six months to 30 June is expected to rise about 4% at constant exchange rates, including underlying revenue growth of around 3%.
Directors now expect full-year revenue growth at constant exchange rates to be driven by "modest" underlying growth, supported by some inflation and a small contribution from acquisitions. Operating margins are still expected to be "slightly down" year-on-year.
7.29am: Brexit anniversary
Today marks the 10th anniversary of the Brexit referendum.
"UK borrowing costs have surged over the past decade," points out market analyst Ipek Ozkardeskaya at Swissquote.
"The 10-year gilt yield stood near 1% on 23 June 2016. Yesterday, it closed near 4.80%. The UK government now spends roughly 8-9% of its revenues on interest payments, growth is weak, productivity is declining, and despite Brexit, immigration has remained elevated.
"At the same time, the composition of migration has changed, with fewer high-earning European workers and a larger share of lower-income migrants, raising concerns about tax revenues and the long-term sustainability of public finances, on top of weak productivity growth."
She says that, a decade after the referendum, "Brexit remains a powerful reminder that political slogans are easy, but rebuilding growth, productivity and public finances is much harder".
Gilts gained yesterday morning after the resignation of Keir Starmer, but retreated by midday to where they were at the end of last week after indications that there should only be a short period of leadership uncertainty.
"However, the composition of the new cabinet will keep gilt traders busy in the coming months," Ozkardeskaya says.
"The government's room for manoeuvre is extremely narrow and bondholders' patience increasingly thin. Whoever takes office must ensure that prosperity comes from stronger productivity and growth rather than more spending financed by unsustainable debt."
On SpaceX she notes that the company launched its first investment grade bond sale, to raise $20 billion.
The move was "quite unusual for a company that is burning cash" and "seemingly, the recent IPO did not suffice to assuage the company's funding needs - a reminder of how much money may still be burned on the way to Mars".
FTSE 100 Live: Pre-open
Blue-chips in London and other European markets are set to see steep declines on Tuesday morning trading, following a mixed session on Wall Street overnight, which is continuing in Asia this morning.
The FTSE 100 has been called roughly 106 points lower on the futures market, more than erasing its gains from yesterday, when it climbed almost 75 points to finish at 10,437.85.
In New York last night, steep losses in some of the market's biggest technology names saw the Nasdaq slip 1.3% and the S&P 500 drop 0.4%, though the Dow Jones rose 0.3%.
Google parent Alphabet fell more than 5% after concerns emerged over talent departures within its artificial intelligence division. Amazon declined around 4% and Meta Platforms lost about 2%, while SpaceX tumbled over 16% - though it is not yet part of the Nasdaq indices.
In Asia, South Korea's Kospi bombed 9.99%, while Japan's Nikkei fell 3.55% and the Hang Seng fell 1.8% in Hong Kong.
Oil prices have continued to retreat, with Brent crude down 1.4% to $76.80 a barrel.
"Wall Street is probably suffering a bit of a SpaceX listing hangover," says market analyst Kyle Rodda at Capital.com.
The fall back to earth of Elon Musk's rocket company "has fueled a tech-led sell-off, with the narrative now shifting back towards questions about AI multiples and fair value", he says.
"Outside the tech complex, cyclical stocks were buoyed by apparent progress in US-Iran negotiations... There remains the typical he-said-she-said back and forth about what was and wasn’t said at the negotiations, especially as it applies to Iran’s nuclear program. However, constructive language from all sides helped oil close Monday’s gap higher after a potentially tense weekend."
