FTSE 100 FINISH LINE
The annual UK CPI inflation rate accelerated more than anticipated in July, climbing to 3.8% from 3.6% in June—the highest level since January 2024. The increase was primarily driven by rising energy and food prices, though the ‘core’ inflation rate also unexpectedly edged up to 3.8% from 3.7% in June. This marks another instance of inflation exceeding forecasts, a trend highlighted by Bank of England policymakers who opposed the August interest rate cut. The latest inflation surge has strengthened market expectations that the BoE Monetary Policy Committee may hesitate to implement further interest rate reductions.
Shares of United Utilities, a UK water utilities company, are up 1.5% to 1,137p. Barclays has upgraded the stock's rating to "Overweight" from "Equal Weight." The brokerage notes that the outlook for the sector is improving and has raised the stock's price target to 1,535p from 1,280p, indicating a potential upside of around 27% from the last closing price. Currently, 14 analysts have rated the stock as "Buy," with a median price target of 1,280.50p, according to LSEG data. Year-to-date, the stock has risen by 8%.
Shares of the construction engineering company Costain Group dropped 17% to 135p, marking the largest one-day percentage decline since September 2020, and making it the biggest loser on the FTSE small-caps index. The company reported a 4.1% decrease in H1 adjusted profit before tax to 18.6 million pounds ($25.11 million), with revenue falling 17.8% to 525.4 million pounds. The revenue decline was attributed to the transportation division due to completed projects in the Road sector and rescheduled HS2 rail work. Despite this, the company expressed confidence in meeting its expectations for further progress in FY25 and FY26. Including session movements, the stock has risen 27% year-to-date, while the FTSE small-caps index is up 5.2%.
Ithaca Energy jumps 7.9% to 192.4p, reaching its highest point since November 2022. The North Sea oil and gas producer has raised its FY25 production estimates from 109,000-119,000 boepd to 119,000-125,000 boepd. In the first half of the year, adjusted EBITDAX has more than doubled to $1.12 billion. As of the last closing, ITH has gained over 61% this year.
Technical & Trade View
FTSE Bias: Bullish Above Bearish below 9000
Primary support 8900
Below 8900 opens 8600
Primary objective 9280
Daily VWAP Bullish
Weekly VWAP Bullish
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!