The FTSE 100 made steady progress on Thursday, shrugging off weak oil majors as the oil price fell, and falls in Asian-focused banks and insurers.
The FTSE 100 closed up 28.02 points, 0.3%, at 10,360.32. The FTSE 250 ended up 116.36 points, 0.5%, at 23,302.65, while the AIM All-Share rose 1.02 points, 0.1%, to 808.26.
Oil continued its seesaw week as investors tracked developments in the war in the Middle East.
Iran reported “no tangible progress” in negotiations on ending the war, even as the US House of Representatives passed a resolution seeking to halt American military action in Iran.
Israel, meanwhile, struck south Lebanon and threatened new attacks on Beirut, despite an announcement hours earlier that the opposing sides had agreed to implement a conditional ceasefire.
AJ Bell head of markets Dan Coatsworth said: “Domestic pressure on Donald Trump to end the war with Iran and a reported ceasefire between Israel and Lebanon have swung the pendulum once again for markets.”
Brent crude for August delivery traded lower at 94.88 dollars a barrel on Thursday, down from 97.37 dollars at the time of the equities close in London on Wednesday.
Reflecting the oil price falls, London-based oil majors BP and Shell fell 1.2% and 1.5%, respectively.
In European equity markets on Thursday, the CAC 40 in Paris ended up 1.2%, and the DAX 40 in Frankfurt closed 0.6% higher.
In New York, the Dow Jones Industrial Average was up 1.8%, the S&P 500 was 0.3% higher, but the Nasdaq Composite dipped 0.2%.
Broadcom’s stock plunged 14%, despite reporting record results, as expectations for AI revenue guidance fell short of lofty hopes.
Analysts at UBS said: “Orders were very strong, but Broadcom didn’t raise AI revenue for either 2026 or 2027, disappointing especially when compared to peers.”
In London, figures continued to show a depressed construction sector.
The S&P Global construction purchasing managers’ index fell to 38.2 points in May from 39.7 in April, remaining well below the 50-point threshold that separates growth from contraction.
The index has now been below 50 points for 17 consecutive months, and May’s reading signalled the steepest decline in construction activity since May 2020. Excluding that Covid pandemic period, it marked the sharpest contraction since March 2009.
The pound traded at 1.3436 US dollars on Thursday, little changed from 1.3435 dollars on Wednesday. Against the euro, sterling eased to 1.1558 euros from 1.1574 euros on Wednesday.
The yield on the US 10-year Treasury trimmed to 4.47% on Thursday from 4.49% on Wednesday. The yield on the US 30-year Treasury narrowed to 4.97% from 4.99%.
The euro traded higher against the greenback, at 1.1624 dollars on Thursday against 1.1606 dollars on Wednesday. Against the yen, the dollar was trading at 159.99 yen, higher than 159.96 yen.
Gold traded at 4,471.69 dollars an ounce on Thursday, up from 4,443.05 dollars on Wednesday.
Asia-focused financial stocks slumped after a media report that residents of mainland China were facing greater constraints in opening offshore accounts at major Hong Kong banks.
The South China Morning Post said as Beijing steps up its regulatory oversight on capital outflows, residents of mainland China are encountering greater constraints on opening offshore accounts, including outright prohibition, at mainland branches of major Hong Kong banks.
Insurer Prudential fell 7.2%, while lenders HSBC and Standard Chartered slid 2.2% and 3.2% respectively.
JPMorgan noted China’s state council decree 837, effective July 1, has “generated meaningful noise around insurers, with mainland Chinese visitor exposure, such as Prudential”.
The decree tightens the process around outbound capital flows, adding requirements on filing, approvals and oversight, but introduces no changes to quantitative limits on permitted flows.
JPMorgan said: “While these headlines look concerning, we think they are likely to have little practical effect.”
Stocks that have suffered from AI disruption fears led the risers, with Relx up 6.0%, London Stock Exchange Group up 5.3% and Autotrader up 3.4%.
On the FTSE 250, CMC soared 17% as it said the next 12 months are expected to be a “defining” period for the group, and forecast operating income for financial 2027 well above market expectations.
The London-based trading platform said pretax profit rose 20% to £101.3 million in the financial year ended March 31 from £84.5 million the year before, with pretax profit margin improving to 25.8% from 24.8%. Profit was below the £106.7 million company-compiled consensus.
Net operating income increased 15% to £392.6 million, ahead of £375.6 million consensus, from £340.1 million in financial 2025, the group’s best performance outside of the 2021 Covid-hit year.
CMC expects net operating income in the year ending March 31, 2027, to rise at least 17% to between £460 million and £480 million, well above the consensus of £385.5 million. Operating costs are projected to be about £280 million.
Following the results, RBC Capital Markets raised its share price target for CMC to 460p from 400p and said it is raising financial 2027 and 2028 EPS forecasts by 23% and 30%, respectively.
But Ceres Power’s recent stellar run faltered, with the stock down 7.3%, as Panmure Liberum downgraded to “sell” from “buy”.
The biggest risers on the FTSE 100 were Relx, up 147.0p at 2,583.0p, London Stock Exchange Group, up 460.0p at 9,162.0p, JD Sports Fashion, up 3.9p at 87.4p, Experian, up 89.0p at 2,610.0p and Sage Group, up 30.0p at 883.2p.
The biggest fallers on the FTSE 100 were Prudential, down 80.2p at 974.8p, J Sainsbury, down 9.4p at 295.2p, Standard Chartered, down 56.5p at 1,955.5p, Rio Tinto, down 225.0p at 7,847.0p, and Polar Capital Technology Trust, down 18.5p at 710.0p.
Friday’s global economic calendar has US nonfarm payrolls figures, plus jobs data in Canada and the Halifax house price index in the UK.
No significant events are scheduled in Friday’s local corporate calendar.
Contributed by Alliance News.