FTSE Holds Near Three-Week Low as WH Smith Sinks

FTSE Futures

UK’s primary FTSE indexes remained close to three-week lows on Wednesday as investors monitored a tenuous ceasefire in the Middle East, while considering the prospects for companies in light of a dismal report from travel retailer WH Smith.

The blue-chip FTSE 100 index inched up 0.2% by 0752, as did the midcap FTSE 250.

  • WH Smith tanked 16.4% to its lowest since late 2010 after cutting its annual profit forecast for the second time in two months and launched an equity rise to bolster its finances as the Iran war disrupts global travel and hurts passenger spending. The stock was the leading decliner on the mid-cap index.
  • Banks were among the top sectoral decliners with a 1% fall, as shares of Hong Kong-exposed HSBC and Standard Chartered lost 1.9% and 0.8%, respectively. The lenders have faced mounting pressure following Beijing’s announcement of stricter capital controls aimed at curbing cross-border investments, with broking J.P. taking note of these developments.Morgan indicated that the impact might exceed earlier expectations.
  • Middle East tensions escalated as the U.S. and Iran exchanged renewed hostilities, yet crude prices remained stable, providing a measure of comfort to investors who awaited further information regarding the impending deal to open the Strait of Hormuz, as indicated by President Donald Trump.
  • Concerns regarding inflation, stemming from heightened crude prices, have led investors to anticipate a 25 basis point interest rate increase by the Bank of England by September, as indicated by data compiled by LSEG.
  • U.S. inflation data later in the day could provide valuable insights into the Federal Reserve’s monetary policy trajectory.
  • Among others, Pennon Group opens new tab slipped 1.3% after its new CEO warned operational discipline must improve, even as the water utility returned to annual profit.
  • EnQuest opens new tab shot up 18% after the North Sea-focused oil producer agreed to buy interests in four offshore contracts in Malaysia for up to $833 million from state-run Petronas, as it expands its South East Asian presence.