London stocks opened flat on Wednesday, with investors digesting a hotter-than-expected UK inflation report that cast further doubt on the Bank of England’s next move.
The FTSE 100 inched up 0.1% to 8,946.81 in early dealings, recovering slightly from Tuesday’s pullback. The FTSE 250 slipped 0.1% to 21,672.42, while the AIM All-Share edged up 0.2% to 772.36.
Sterling nudged higher after fresh inflation figures from the Office for National Statistics surprised to the upside. UK consumer price inflation accelerated to 3.6% in June, from 3.4% in May, topping consensus forecasts of 3.5%. Core CPI, which excludes food, energy, alcohol and tobacco, also overshot expectations, rising to 3.7% from 3.5%.
The ONS said rising transport costs, particularly fuel prices, made the largest upward contribution. Services inflation remained stubbornly high at 4.7%, unchanged from May.
Wednesday’s figures cooled optimism around a Bank of England rate cut next month. Markets still price in an 86% chance of a 25 basis point cut in August, according to futures markets, but sticky inflation is seen complicating the decision.
In the FTSE 100, Rio Tinto and Antofagasta rose 2.1% and 2.2% respectively after both posted broadly positive production updates and maintained full-year guidance. Rio flagged improved iron ore shipments, while Antofagasta reported higher copper output and a 3% decline in net cash costs.
McBride tumbled 15%. The household products manufacturer said it expects full-year adjusted operating profit to be in line with forecasts, but warned of stabilising private label market share and mounting margin pressures as retailers push for lower costs. Revenue for the year to June 30 rose 0.7% at constant currency.
In oil stocks, Gulf Keystone Petroleum dropped 4.8% and Genel Energy slipped 5.6%, with no fresh catalysts but continued investor caution around Kurdistan oil export flows.
Among mid-caps, Ultimate Products gained 4.3%, extending recent momentum following its strong trading update last week. Bank of Georgia Group and Mobico Group also rose just over 4%.