Source: Sharecast
The FTSE 100 index declined 0.43% to close at 9,081.44 points, while the FTSE 250 slipped 0.75% to 21,951.80 points.
In currency markets, sterling weakened 0.35% against the dollar to last trade at $1.3391, but rose 0.81% against the euro, changing hands at €1.1535.
Russ Mould, investment director at AJ Bell, said that while the US-EU deal initially sparked relief, “enthusiasm is tempered by the fact this is only a framework agreement, with the risk that Donald Trump could revise its terms at any time.”
Patrick Munnelly, partner at TickMill, noted that the early rally was undercut by a “buy the rumour, sell the news” sentiment as traders questioned the longer-term implications of the deal.
The US agreement with the EU includes a 15% tariff on most EU goods and a pledge by the bloc to invest $600bn in the US.
UK retail sales decline slows, EY ITEM Club upgrades GDP forecast
In economic news, UK retail sales remained under pressure in July, though the pace of decline slowed, according to the Confederation of British Industry’s latest survey.
The retail sales volume balance improved to minus 34% from minus 46% in June, but July marked the tenth consecutive month of contraction.
Expected sales for August were also negative at minus 31.
Martin Sartorius, principal economist at the CBI, said that “elevated price pressures - driven by rising labour costs - and economic uncertainty continue to weigh on household demand.”
He added that both wholesale and motor trades had also reported weaker sales, reflecting subdued demand across the distribution sector.
Separately, the EY ITEM Club upgraded its UK GDP growth forecast for 2025 to 1.0% from 0.8%, citing stronger-than-expected business investment in the first quarter.
However, it warned that growth was likely to remain muted amid global trade disruption and a fragile labour market.
Inflation was expected to average 3.4% this year before easing to 2.6% in 2026.
EY anticipated that the Bank of England would cut interest rates by 25 basis points at its meeting next week, with further reductions likely later in the year.
GSK and FirstGroup advance, Ocean Wilsons slides
On London’s equity markets, pharmaceuticals giant GSK gained 0.39% after unveiling a partnership with China’s Hengrui Pharma to co-develop up to 12 medicines, which analysts said could boost long-term growth prospects.
Russ Mould noted that GSK and AstraZeneca “have given investors more reasons to be optimistic about future earnings,” as AstraZeneca also advanced its oncology pipeline.
FirstGroup rose 1% after acquiring Leeds-based Tetley’s Coaches, strengthening its presence in the UK coach and bus sector.
Computacenter recovered to finish flat, reversing earlier losses after reaffirming that full-year adjusted operating profits would remain ahead of 2026 levels despite weaker second-quarter trading in Germany and France.
On the downside, Cranswick dropped 1.5% after maintaining its annual profit guidance despite a 7.9% increase in like-for-like revenue, as investors questioned margins.
BT Group fell 5.07% following last week’s rally, while Ocean Wilsons Holdings plunged 14.04% after announcing a £900m all-share merger with Hansa Investment Company.
Patrick Munnelly highlighted that “industrial miners weighed on the FTSE, while the real estate sector and auto stocks provided some early strength.”
Among small caps, STV tumbled 27% after warning on profits, underscoring a challenging environment for UK broadcasters.
Reporting by Josh White for Sharecast.com.
Market Movers
FTSE 100 (UKX) 9,081.44 -0.43%
FTSE 250 (MCX) 21,951.80 -0.75%
techMARK (TASX) 5,240.30 -0.38%
FTSE 100 - Risers
BP (BP.) 406.60p 2.21%
Flutter Entertainment (DI) (FLTR) 22,780.00p 1.88%
Smurfit Westrock (DI) (SWR) 3,631.00p 1.82%
Airtel Africa (AAF) 198.20p 1.64%
RELX FINANCE BV 3.375% GTD NTS 20/03/33 (BW73) 99.72p 1.10%
Land Securities Group (LAND) 590.50p 1.03%
Rightmove (RMV) 787.60p 0.92%
Shell (SHEL) 2,687.00p 0.73%
Reckitt Benckiser Group (RKT) 5,624.00p 0.72%
St James's Place (STJ) 1,166.00p 0.69%
FTSE 100 - Fallers
BT Group (BT.A) 211.40p -5.07%
Babcock International Group (BAB) 1,010.00p -3.16%
Marks & Spencer Group (MKS) 345.40p -2.70%
Rentokil Initial (RTO) 361.00p -2.67%
BAE Systems (BA.) 1,805.00p -2.25%
Games Workshop Group (GAW) 15,260.00p -2.18%
WPP (WPP) 424.00p -2.06%
Pershing Square Holdings Ltd NPV (PSH) 4,164.00p -1.93%
Schroders (SDR) 395.40p -1.89%
Experian (EXPN) 3,982.00p -1.82%
FTSE 250 - Risers
SDCL Efficiency Income Trust (SEIT) 57.40p 3.42%
Ithaca Energy (ITH) 173.00p 3.10%
Diversified Energy Company (DEC) 1,136.00p 2.34%
NCC Group (NCC) 152.20p 2.15%
Target Healthcare Reit Ltd (THRL) 101.60p 2.11%
Vietnam Enterprise Investments (DI) (VEIL) 697.00p 1.90%
Lion Finance Group (BGEO) 7,480.00p 1.70%
Harbour Energy (HBR) 202.60p 1.66%
Bytes Technology Group (BYIT) 346.00p 1.65%
Wizz Air Holdings (WIZZ) 1,216.00p 1.59%
FTSE 250 - Fallers
Ocean Wilsons Holdings Ltd. (OCN) 1,255.00p -14.04%
Ocado Group (OCDO) 320.70p -7.63%
Close Brothers Group (CBG) 406.60p -5.79%
Keller Group (KLR) 1,334.00p -3.75%
ITV (ITV) 82.55p -3.68%
Aston Martin Lagonda Global Holdings (AML) 81.75p -3.65%
Vistry Group (VTY) 601.80p -3.50%
Wetherspoon (J.D.) (JDW) 763.50p -3.42%
Greggs (GRG) 1,645.00p -3.24%
IP Group (IPO) 54.50p -3.20%