The FTSE 100 opened 22 points lower at 10,502 on Tuesday as investors weighed a proposed 10-day US-Iran ceasefire against fresh attacks in the Strait of Hormuz. Stronger-than-expected UK jobs data and lower June public borrowing offered a mixed picture for markets.
Market Overview
Brent crude futures fell 0.54% to $88.74 per barrel, while US West Texas Intermediate (WTI) declined 0.19% to $82.32 per barrel. Sterling strengthened to $1.3446 early Tuesday, up from $1.3418 at the London equities close on Monday. Against the euro, sterling rose to 1.1767 from 1.1755 a day earlier.
Gainers & Losers
On the upside, Babcock International Group surged 6.65% to £11.07, Antofagasta advanced 3.58% to £35.89, and BAE Systems gained 3.17% to £19.35. Endeavour Mining climbed 3.15% to £35.32, while Fresnillo rose 2.89% to £25.28. Glencore also added 2.19% to £5.23.
On the downside, Games Workshop Group fell 1.44% to £198.50, London Stock Exchange Group declined 1.31% to £87.28, and Unilever slipped 1.19% to £45.84. Diploma lost 1.02% to £72.95, Admiral Group dropped 1.51% to £35.22, and Next edged 0.61% lower to £147.90.
UK Unemployment Declines
UK unemployment fell to 4.9% in the three months to May, down 0.1 percentage points on the quarter and below the 5% forecast, the Office for National Statistics (ONS) reported Tuesday. Employment rose by 148,000 in the quarter, well above analysts’ estimate of 80,000, pushing the employment rate to 75.1%. Average weekly earnings grew 4.3% year-on-year, just shy of the 4.5% forecast, while pay excluding bonuses rose 3.4%, in line with expectations.
Private-sector regular pay growth was 2.9%, compared with 5.5% in the public sector. Vacancies fell by 7,000 to 712,000 in the second quarter.
MHA’s Pre-Tax Profit Rises
Professional services firm MHA posted double-digit revenue growth in its first year as a London-listed company. The group’s pre-tax profit jumped 11% to £39 million as revenue grew 12% to £251 million. Over the past year, listed client fees surged 16%, driven largely by 15% organic growth within that client base. Since its IPO, MHA has completed two key acquisitions: Baker Tilly South-East Europe and MS UAE in the Middle East. The firm aims to double its current size, targeting annual revenues of over £500 million.
Key Fiscal Target Missed
Official data on Tuesday showed the current budget deficit exceeded forecasts from the Office for Budget Responsibility (OBR). The ONS reported that borrowing to fund day-to-day public sector spending was £11.8 billion in June, around £1.3 billion above the OBR’s estimate. Government borrowing was slightly lower than expected at £16 billion in the month, though total borrowing in the current financial year reached £57.6 billion. Public sector debt was higher than the same point last year at 94.9% of GDP.
Global Market View
In the US, the S&P 500 fell on Monday as oil prices advanced, dropping 0.19% to close at 7,443.28. The Nasdaq Composite lost 0.05%, and the Dow Jones Industrial Average fell 307.16 points, or 0.59%. In Asia, Tokyo’s Nikkei 225 rose 3.26% to 66,232.19, while China’s Shanghai Composite advanced 1.79%. Hong Kong’s Hang Seng fell 0.094%, and South Korea’s Kospi gained 3.56%. In India, both the Nifty 50 and the Sensex fell by 0.33% and 0.41%, respectively.