- FTSE 100 down 20 points at 10,867
- Iran and Oman confirm Hormuz agreement, oil and bonds little moved
- WPP, Admiral and Persimmon rise on results, OSB, TP Icap, Wizz Air fall
5.30pm: FTSE flops
The FTSE 100 remains unable to reach 11,000, finishing Thursday’s session down 20 points at 10,867.
“The next big round number is still a distant dream for the FTSE, despite a day of well-received results,” IG chief market analyst Chris Beauchamp said.
“Rising oil prices have crimped some of the optimism seen earlier in the week, but the price is still much lower than a week ago, providing a positive tailwind as we move into the second week of August.”
2pm: UK Culture Sec approves Paramount-Warner Bros merger
The £110 billion Paramount-Warner Bros deal has been approved by the UK competition regulator today and was waved through by the UK culture secretary.
Lisa Nandy decided not to intervene after Paramount boss David Ellison offered legally binding commitments covering editorial independence, public service broadcasting and children’s programming.
These include £80 million of additional investment in Channel 5 over three years and guarantees that its news operations "will remain entirely separate from CNN and CBS News".
Paramount also promised to retain the identities of kids' TV channels Nickelodeon and Cartoon Network and not replace UK commissions with imported content.
As reported below, the UK CMA found no realistic prospect that the merger would substantially reduce competition. It said the combined group would continue to face sufficient pressure from rival film studios, streaming services and broadcasters.
The EU also has approved the deal, though it still faces a US lawsuit led by California’s attorney-general, where a trial is scheduled for March 2027.
1.33pm: US stocks mixed
Wall Street is heading for another mixed session, as the latest batch of technology earnings seems to undermine confidence.
Dow Jones and S&P 500 futures are up 0.2-0.1%, while Nasdaq futures are down 0.5%.
AppLovin, Western Digital and SanDisk are leading the pre-market declines for the Nasdaq, falling around 19%, 15% and 10%, respectively, after reporting overnight. Bucking the trend, eBay is up 1.4%.
Today’s US economic data includes initial jobless claims, second-quarter productivity, unit labour costs and wholesale trade figures, ahead of the big non-farm payrolls tomorrow.
1.06pm: Diageo generates 'high excitement'
Diageo's strategy update today has been "hugely awaited", says market analyst Richard Hunter at Interactive Investor, and has been "met with high excitement by investors, as Diageo sets out its stall to revitalise what had become something of an ailing business".
While there will be more detail given during the CMD presentation coming soon, but the basics revealed in the statement were three pillars: a tighter focus on the width and depth of its brand offerings, more customer engagement relating to changing trends, and an agile operating framework. The latter will result in cost savings of $850 million over the next two years and $1 billion over the next three.
Guinness, "the jewel in the crown", says Hunter, will receive accelerated investment to capitalise on the growing global opportunity (and the splitting-the-G trend), which has seen double-digit sales growth for the fifth consecutive year.
"Some of this recognition of a new world had already been put in play, with a cut to the dividend, a restructure of the business and the acknowledgement of a cost-conscious consumer likely to shape the group’s intentions.
"The likelihood of less profitable mainstream offerings will not signal the end of Diageo’s premiumisation agenda, but rather the offering will be widened and complementary in serving different markets, such as North America which has been the source of particular weakness more recently."
Hunter says this does not mean a clear path ahead, and it "remains to be seen whether the concerns overhanging the sector as a whole are cyclical or societal".
The coming year "will largely be seen as one of stability as the new growth strategy settles in," he adds, with Diageo guiding for flat organic net sales and low to mid-digit adjusted operating profit growth.
12.39pm: CMA green lights Paramount-Warner Bros deal
The UK competition watchdog has cleared Paramount Skydance’s planned acquisition of Warner Bros Discovery, removing the threat of a more detailed phase-two investigation.
The Competition and Markets Authority concluded that the merger did not present a realistic prospect of substantially reducing competition in Britain.
The combined company would become the UK’s largest theatrical film distributor, but the CMA said it would continue to face competition from Universal, Disney, Sony and smaller studios.
It also dismissed concerns covering streaming and children’s television. Netflix, Apple, Disney, Amazon Prime, BBC iPlayer and ITVX would provide sufficient alternatives in streaming, it said, while demand for traditional pay-TV children’s channels is declining.
Many in the industry have objected to the deal, raising concerns that combines two historic studios narrows the pipeline of who buys and produces film and television.
More than 1,400 actors, directors and filmmakers - including Emma Thompson, Ben Stiller, Javier Bardem and Kristin Scott Thomas - signed an open letter earlier this year opposing the merger.
David Ellison, Paramount chief executive and the son of tech billionaire Larry Ellison, has said that he aims to keep the two as stand-alone movie studios and increase theatrical output to 30 a year.
11.56am: Lewis wants Diageo to be 'more agile, competitive and cost-effective'
In the statement about today's investor day, Diageo boss Dave Lewis says: "We look forward to meeting with shareholders this afternoon to share the progress we've made over the past six months, the strategic direction we have chosen, and to provide medium-term guidance.
"This new strategy, executing with a new, more agile, competitive and cost-effective operating model, gives us confidence that we can return Diageo to a business consistently creating value for shareholders."
That doesn't sound that different from what most CEOs say in turnarounds, to be fair.
He adds: "We remain a business with a very strong premiumisation agenda, but by activating our wider portfolio, we will be able to serve more consumers, across a variety of occasions.
"There is hard work ahead, particularly in North America, where improving performance is a clear priority, but we are confident we can deliver without taking a step back in operating profit."
Diageo has been a very well-followed share among retail investors this year (and three of our experts picked it in the Christmas stock picks competition) and there is sure to be a fair amount of interest in the 1.30pm event (link here).
11.44am: Diageo sets out $8bn cash target
Ahead of a capital markets day presentation this afternoon, Diageo said it expects broadly flat organic sales in the 2027 financial year, including a "mid-single-digit" percentage decline in North America, while organic operating profit is forecast to grow in the "low to mid" single digits.
The group is targeting around $1 billion of savings over three years, comprising $850 million from its new operating structure and $150 million from supply-chain initiatives.
Lewis said there was “hard work ahead, particularly in North America”, but Diageo was confident it could complete the turnaround “without taking a step back in operating profit”.
For the 2027-2029 financial years, Diageo expects low-single-digit annual sales growth, mid-single-digit operating profit growth and cumulative free cash flow of around $8 billion.
11.29am: Diageo releases results
Diageo shares have jumped 6.3% after the booze maker poured out its much-anticipated results at the unusual time of 11am, reporting higher underlying profit and cash flow despite weaker sales in North America and China.
Organic net sales fell 2% in the year to 30 June, with volumes down 0.4%.
The Guinness and Smirnoff maker said organic sales would have grown by around 1.5% excluding Chinese white spirits, where government policies have weighed on the market.
Reported operating profit fell 27.2%, reflecting $900 million of restructuring charges and $1.5 billion of impairments, mainly related to operations in Türkiye, the Don Papa rum brand and several smaller brands.
Free cash flow was much improved.
Chief executive Sir Dave Lewis said Diageo was working to restore its competitiveness in North America and expects his restructuring programme to generate around $850 million of savings over two years from the 2027 financial year.
Diageo roughly halved its dividend to 50 cents per share.
11.09am: Dire straits
Prediction market traders see little chance of a meaningful recovery in shipping through the Strait of Hormuz by the end of this month, despite today's talk of a diplomatic breakthrough.
The most likely outcome on Polymarket is that traffic stays at a trickle, with a 44% chance on the seven-day average of transit calls being between 0-20 a day on 31 August, and a further 32% on the 20-40 range.
That leaves a combined 76% probability that fewer than 40 ships a day are moving through the world's most important oil chokepoint at the end of the month.
The chance of more than 80 ships a day is priced at 1%. A separate market on traffic returning to normal by 31 August is trading at 16%.
10.29am: Geopolitics failing to move the needle for markets
Some geopolitics, which still does not look to have shifted the dial for oil markets, with Brent crude largely unmoved, amidst hopes of a wider diplomatic breakthrough in the Middle East, though the details remain messy.
Pakistan this morning said it hoped a proposed agreement between Iran and Oman over the Strait of Hormuz would pave the way for US-Iran technical talks to resume.
Tehran said the deal was close to completion, but Iranian sources rejected Donald Trump’s claim that an agreement was imminent and said important details remained unresolved.
Reports suggest Iran could gain some control over vessels entering the Gulf, while Oman would oversee outbound shipping. Iran has also linked reopening the strait to the removal of the US blockade of its ports.
The prospect of restoring traffic through a route that previously carried around a fifth of global oil and gas supplies is helping to ease energy concerns. But the Iran-backed Houthis’ attack on two Saudi oil tankers and uncertainty over the final Hormuz terms leave plenty of scope for another reversal.
Trump also railed against reports that depleted US missile and air-defence stockpiles were constraining military options against Iran, insisting the country still had “massive amounts” of munitions.
"Defense companies are building the largest number of plants and factories in our country’s history. The “leakers” of these treasonous statements are being hunted down. Long term jail sentences will be sought," he ranted in a social media post.
9.52am: 'Construction sector has started to stabilise'
July's PMI "suggests that the performance of UK construction sector has started to stabilise after a sharp downturn throughout the second quarter of 2026," says Tim Moore, economics director at S&P Global Market Intelligence, which produces the PMI survey.
"Business activity levels continued to decline in all three main categories, but in each case the rate of contraction was much slower than in June.
"This was supported by the weakest reduction in new business intakes since September 2025.
"Survey respondents commented on signs of a turnaround in client demand and a revival in new tender opportunities in some cases, despite subdued underlying market conditions.
"This contributed to more upbeat business activity expectations for the year ahead, with confidence levels the highest since February.
"A renewed improvement in supplier performance and softer input cost inflation were also positive developments in July.
"Construction companies widely commented on fuel surcharges and higher raw material prices due to the war in the Middle East, but the overall rate of cost inflation was the lowest for five months."
9.44am: UK construction PMI improves
Britain's construction downturn eased much more sharply than expected last month, according to the S&P Global construction PMI.
The UK construction PMI rose to a four-month high of 44.7 from 38.4 in June, comfortably beating the consensus forecast of 40.0. A reading below 50 still signals falling activity.
All three main construction categories contracted more slowly. Commercial construction was the most resilient at 46.8, while housebuilding improved to 41.8 and civil engineering remained the weakest at 38.3.
New orders fell at their slowest rate since September, while business confidence reached a five-month high. Tim Moore at S&P Global said the figures suggested the sector had “started to stabilise” after its sharp second-quarter downturn.
Construction activity has now declined continuously since January 2025 – the longest such run since the global financial crisis.
9.28am: Market awaiting US confirmation on Iran deal
The FTSE's gains have dissipated a little, now up just over 10 points, while the FTSE 250 is in the red.
Miners are dragging a little on the blue-chip index, with Rio Tinto, Glencore, Anglo American and Antofagsata all down 0.6-1%.
"It may seem like a quiet start to the day, but in reality, there is a huge amount going on underneath the surface," says Kathleen Brooks, research director at XTB.
The oil price is remaining steadfast at around $80 per barrel, despite Iran saying that it had reached an agreement with Oman about the route for shipping lanes in the Strait of Hormuz, and Tehran saying that the US has agreed to return to the Memorandum of Understanding pledges.
"Caution in the oil price today is a sign that the market needs confirmation from the White House that this is all true, and the prospects of a deal to reopen the Strait of Hormuz is not a false dawn," says Brooks.
"President Trump will also need to state his approval for the market to believe it. For now, Brent is likely to remain in a tight range below $80 per barrel. However, confirmation from the US could send Brent back towards $75."
With the FTSE 100 near all-time highs and the FTSE 250 also reaching a new peak, Brooks says "this is a reminder that the recent global stock market rally is not only about tech".
As the comes after stronger PMI data for last month, "suggests that the UK economy is gaining momentum as we move through Q3" and could see UK stocks benefit from upward momentum for earnings.
Brooks notes that SpaceX is higher by more than 1% in overnight trading and "could attempt a recovery later today", with the stocxk "worth watching closely" today as it was the worst performer on the Nasdaq 100 yesterday and faces a big hurdle today with stock lock-uyps coming to an end.
"It is also a highly volatile stock, so if it recovers it could be a sign of stronger overall sentiment for the index."
Brooks says the market could be a bit "directionless" as we lead up to some major event risk, including Friday’s US jobs report.
"Payrolls are always important, but they are taking on extra significance since the Fed has dropped forward guidance."
9.04am: Admiral admired but not by all
Admiral boss Milena Mondini de Focatiis said the group had increased motor insurance rates ahead of the wider market following a “softer period in the cycle”, as it priced for sustainable long-term growth.
Analysts at Citi recently noted how the group has been drip-feeding small inflation-adjusted premium increases to gradually strengthen margins and earnings, with conditions in UK motor insurance likened to the "boiling frog" description once used by Admiral co-founder Henry Engelhardt two decades ago.
Peel Hunt analyst Andreas van Embden, who has a 'sell' rating on the shares, says the dividend was better than expected and the solvency ratio in line with forecasts, but the decline in PBT was worse than the consensus forecast.
The decline was largely driven by an 18% drop in the UK motor business, with results flat versus the second half of last year but including significantly higher reserve releases, that van Embden suspects was from reserve releases being brought forward.
"The outlook for UK motor claims inflation is 5-7% and ADM states rates are broadly flat and that significant rate increases will be needed to turn the market.
"ADM is increasing rates in the high single-digits ahead of the market and in line with inflation in order to try and stabilise margins and does not expect to grow this year.
"We believe this risks losing some competitiveness in the second half of the year. With 29% downside to the current share price, we reiterate our Sell recommendation."
8.47am: OSB falls as profit and guidance drop
OSB Group is the biggest faller on the FTSE 250 this morning, down 13.4% after the owner of Charter Savings Bank and Kent Reliance reported interim results showing a fall in profit before tax to below forecasts.
While the net loan book grew 1.3%, helped by 10% growth in originations in line with management guidance, analyst Abid Hussain at Panmure Liberum notes that the net interest margin fell to 223bps from 230bps "as more costly spreads on new retail funding outweighed new business written at sustainable margins".
Impairments rose to £16 million from £2 million, which was worse than the market expected, but Hussain says "looks more like a normalisation off an unusually low base rather than borrower stress, since arrears balances decreased".
Together with higher admin expenses, this was the cause of the 3% fall in PBT to £187 million, a 2% miss against consensus.
Guidance for the net interest margin has been cut too, on the view that high retail funding costs will not ease and that competition in the retail savings market stays strong.
8.31am: WPP soars, PZ Cussons (LSE:PZC) falls
On the FTSE 250, shares in WPP have soared 25% this morning as the advertising group reported a smaller decline in revenues for the second quarter as improving media performance offered early evidence of progress under new CEO Cindy Rose's turnaround plan.
Revenue less pass-through costs fell 4.7% on a like-for-like basis to £4.75 billion in the first half, compared with the “mid to high single digit” decline forecast in April.
The decline moderated to 2.8% in the second quarter from 6.7% in the first, helped by an improved trend at WPP Media and easier comparisons.
Rose said: "While legacy account losses continue to weigh, Q2 saw a further sequential improvement in LFL growth, highlighting the momentum we are building across the company".
PZ Cussons (LSE:PZC) has dropped 4% despite beating its recently upgraded profit forecast and resumed dividend growth after stronger sales and a sharp reduction in debt.
The Carex and Imperial Leather owner reported adjusted operating profit of £59.5 million for the year to 31 May, up 24.5% on last year and above the £53-57 million guidance range given in June.
8.15am: Metlen and Admiral help FTSE open higher
The FTSE 100 has inched higher in early deals, up 18 points to 10,907.
Top of the leaderboard is Metlen Energy & Metals, up 10% as the Greek energy and metallurgy group celebrated a year in the index with a positive set of results.
Next is Admiral, up 4.1% to a new all-time high despite a fall in profits and a near-40% dividend cut.
Persimmon is up 3.8% on the back of its results too,
Other risers include defence names BAE Systems and Babcock, along with retailers and housebuilders.
At the other end, Tritax Big Box REIT is down 4.5% after issuing new shares to raise £350 million to fund its data centre development pipeline.
8am: Admiral profits falls as conditions get 'more challenging'
Admiral Group has reported an 18% fall in first-half profit and cut its interim dividend by 39% as conditions in the UK motor insurance market became more challenging.
CEO Milena Mondini de Focatiis said: "Against more challenging market conditions, we are pricing for long-term sustainable growth with our UK motor business having increased rates earlier than the market, following a softer period in the cycle."
She added that the recent acquisition of Flock, a provider of digital insurance for commercial vehicle fleets, has been completed and integration is "progressing well".
7.43am: Persimmon keeps dividend flat
Persimmon held its dividend flat as it reported double-digit growth in first-half profits and completions but flagged signs of softer demand in the second half and additional inflationary pressure for next year.
The FTSE 100 housebuilder has posted interim results showing underlying operating profit rose 10% to £189.1 million, although the margin narrowed by 30 basis points to 12.8%.
Almost 5,190 home sales were completed in the six months to 30 June, up 13% from a year earlier, while the average selling price edged 1% higher to £285,752.
Persimmon's recent trading suggested some cooling in the open market, with net private sales rate excluding bulk deals falling to 0.59 from 0.61 in the five weeks since June and weaker enquiries seen during July.
7.28am: FTSE 250 high
It should not have gone unmentioned, but the UK's mid-cap index hit a record high yesterday.
The FTSE 250 climbed 155.75 points or 0.6% to close at 24,459.3, having gained over 400 points this week.
Unlike the FTSE 100, which has been notching new highs all over the place this year, the 250 was slowly ascending back to the previous high from 2021.
FTSE 100 Live: Stocks called higher, is Iran another false dawn?
London's blue-chip shares index is set to open modestly higher on Thursday as investors focus on another busy day of corporate reporting and mull whether news of an Iran deal is another false dawn.
The FTSE 100 has been called 22 points higher on the futures market, after adding nine points to close at 10,888.3 yesterday.
Wall Street trading was mixed overnight as this week’s equity rally began to lose momentum. The Dow Jones rose 0.5% to another record closing high, but the S&P 500 slipped 0.2% and the Nasdaq fell 0.8%, ending a four-day winning streak.
Investors remain cautiously optimistic that negotiations with Iran could lead to the partial reopening of the Strait of Hormuz.
Tehran said it had agreed a proposed shipping route with Oman, although the arrangement would be temporary and would not represent a full reopening of the waterway.
Jim Reid at Deutsche Bank said markets had experienced “plenty of false dawns” during the conflict, with attention now shifting towards the details of any agreement.
President Donald Trump struck a more guarded tone, saying he would “see what happens” in the talks.
Brent crude is roughly flat at around $79.50 a barrel this morning, while European and UK natural gas prices have dropped more than 13% over the past week.
Asian markets are weaker this morning, amid renewed caution towards technology stocks. South Korea’s Kospi is down 4.6%, while Japan’s Nikkei has fallen 0.9% and Hong Kong’s Hang Seng lost 1.7%.
Today’s economic calendar includes the UK construction PMI, German factory orders, eurozone retail sales and US jobless claims.
The UK corporate diary includes Persimmon, WPP, Harbour Energy, Admiral, TP ICAP, Serco, Hikma Pharmaceuticals, Metlen Energy, Quilter and OSB Group, while ConocoPhillips (NYSE:COP, XETRA:YCP), Howmet Aerospace, Datadog and Constellation Energy lead the US pre-market slate, followed by Cloudflare, Petrobras (NYSE:PBR) and Monster Beverage after the close.
Overnight, AppLovin and SanDisk plunged almost 16% and 8% in afterhours trading after reporting earnings, while eBay climbed 2% after its numbers.
