The FTSE 100 was lower on Wednesday as UK stocks tracked US markets lower, with major indices taking a break from a rip-roaring rally.
London’s leading index was down 0.2% at the time of writing.
“Wall Street hit pause on its rally yesterday, with the S&P 500 slipping 0.6% and the Nasdaq down 0.9%. The pullback came after three straight record closes, as Fed Chair Powell flagged ‘fairly highly valued’ equity prices and investors reassessed the sustainability of recent AI-fuelled gains,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.
“Micron bucked the trend with strong earnings and a bullish AI outlook, while Lithium Americas shares soared on news that it may be the US government’s next target for an equity stake.”
Defence names were the best performers in London on Wednesday after Donald Trump said European countries should shoot down Russian jets that violate their airspace. The US president also changed his tone on Ukraine, suggesting that Ukraine should retake land currently occupied by Russia.
This all hints at escalation or a prolonged conflict that will require higher defence spending. Babcock and BAE Systems were both higher by more than 1%.
JD Sports was also among the gainers as the firm announced a fresh £100m share buyback despite like-for-like growth remaining in retreat in all geographies in which the sports retailer operates.
“JD Sports delivered robust headline sales growth of 20% in the first half, supported by the major acquisitions of Hibbett and Courir, which expanded its reach in North America and Europe and drove further market share gains,” said Adam Vettese, market analyst for eToro.
“However, overall profit before tax fell by 13.5%, reflecting margin pressure, increased promotional activity, and softer trading in key regions, particularly the US and UK. Operating profit and adjusted earnings also declined as the group navigated a highly competitive retail environment and heightened cost inflation.
“Despite these challenges, JD’s disciplined execution and strong cash generation enabled a new £100 million share buyback, showcasing confidence in its long-term prospects. Continued investment in omnichannel infrastructure and brand partnerships lays the groundwork for future growth, but the near-term outlook remains cautious given macro uncertainties and ongoing margin risks.”
Burberry was the FTSE 100’s top faller with a 2.3% decline.