The FTSE 100 was higher on Thursday as the index recovered from a wobble in UK assets following speculation about the Chancellor Rachel Reeves’ future. A trade deal between the US and Vietnam also helped boost sentiment and interest in equities.

London’s leading index was 0.4% higher at the time of writing as bond yields eased and the pound moved higher against the dollar.

“After yesterday’s political chaos around the future of Rachel Reeves as chancellor triggered a spike in UK government bond yields, prime minister Keir Starmer has now brought a sense of calm to markets,” says Dan Coatsworth, investment analyst at AJ Bell.

“Starmer declaring his support for the chancellor has led to gilt yields pulling back and sterling rebounding after yesterday’s slump against the dollar. The initial sell-off in gilts and the pound was the market’s way of saying it was losing faith in the economic outlook and political stability.

“It was an electric shock for investors but today’s rebound suggests that crisis has been averted, at least for now. UK economically sensitive assets were in relief mode, including a rally in housebuilders and banks.”

Although Rachel Reeves is becoming increasingly unpopular among the voting public due to her tax increases and welfare reforms, the sharp increase in gilt yields yesterday, on speculation that she may leave, suggests that she is seen as a good bet by the bond market.

Nonetheless, the easing of uncertainty was felt across UK-centric FTSE 100 stocks on Monday with NatWest, Lloyds, Sainsbury’s and Marks & Spencer among the top risers.

Retailers were boosted by strong results from Currys, which has begun paying dividends again after a prolonged period of strategic realignment.

FTSE 100 gains were broad, with 87 of the 100 constituents trading positively at the time of writing. A deal between Vietnam and the US helped lift sentiment, sparking a rally in US stocks overnight that filtered through into the European session.

“The details remain to be seen, but it is good to have some more certainty, and also to see Trump praise the Vietnamese again, pointing out his admiration for General Secretary To Lam,” said Craig Martin, Chairman of Dynam Capital, the manager of the Vietnam Holding Investment Trust.

“The headline figure of 20 percent is in the expected range. That said, it is still high – a classic case of Anchor Bias: Start with a ridiculously high opening bid, 46 percent, and then anything lower looks like a win. 

“Vietnam has gone to great efforts to accommodate Trump. It has also recognised the need to further diversify its trade partners and to prioritise the expansion of its domestic economy.”

Mkango Resources shares were 50% higher on Thursday after announcing a deal the company believes will position them as a ‘key player in the global rare earth supply chain’.

Mkango Resources has announced a transformative business combination that will create a publicly traded rare earth platform set to benefit from the growing demand for critical materials used in renewable energy and technology.

The deal will merge Mkango’s Songwe Hill project in Malawi with the Pulawy separation facility in Poland, creating a vertically integrated operation that can mine, refine and separate rare earth materials for supply chains across North America, Europe and Asia.

The combined entity, to be called Mkango Rare Earths Limited, is expected to list on the Nasdaq stock exchange. Mkango’s pro forma valuation of their stake in the new entity is $400m.

Both projects have been designated as strategic under the EU Critical Raw Materials Act, providing regulatory support and potential funding opportunities. Songwe Hill has also received backing from the Minerals Security Partnership, demonstrating international confidence in the project.

Songwe Hill has already completed advanced feasibility studies and environmental assessments, significantly reducing development risk.

The vertical integration model—controlling everything from mining to final processing—should deliver higher margins and greater supply chain security.

“We are excited to announce the signing of a transformative Business Combination Agreement with CPTK, which I believe marks a pivotal step towards unlocking substantial shareholder value,” said Alexander Lemon, President of Mkango.

“This transaction is expected to significantly accelerate the growth trajectory of the Mkango group and position us as a key player in the global rare earth supply chain, with a strong emphasis on sustainability and critical industry demand. Partnering with CPTK, an organization that shares our strategic vision and values, enhances our platform for scalable growth and innovation. As we move towards a Nasdaq listing, we believe this combination will catalyse new opportunities, broaden our investor base, and drive long-term value creation.”

Currys shares surged on Thursday after the group released financial results that represent a dramatic turnaround for the company, which is now able to resume dividends after years of uncertainty.

Shares in the group were 8% higher at the time of writing.

Currys’ revenue rose 3% to £8.7bn and adjusted profit before tax increased 37% to £162m in the year to 3 May 2025.

The UK&I division performed particularly well with 6% revenue growth driven by market share gains, whilst services revenue grew 12% and credit sales expanded 14% to £1.1bn. These are all very respectable metrics.

The Nordics are still a problem. The division faced challenging market conditions but improved profitability with adjusted EBIT rising 24% on a currency-neutral basis, supported by gross margin expansion of 60 basis points.

Investors will be delighted to see that cash generation was exceptionally strong, with group free cash flow surging 82% to £149m, contributing to year-end net cash of £184m – the strongest balance sheet position in over a decade.

Underscoring the progress the company has made in recent years, the company proposed the resumption of dividends with a final dividend of 1.5p.

Currys said that early trading in the new financial year is meeting expectations, and management is comfortable with market consensus forecasts.

The company is targeting continued expansion in higher-margin recurring revenue services, including reaching at least 2.5m iD Mobile subscribers by year-end.

“In a sharp reversal of fortunes, Currys has delivered a turnaround few expected, and shareholders have reaped the rewards. The company has once again beaten profit expectations, having quietly but decisively reshaped itself over the past 18 months,” said Mark Crouch, market analyst for eToro.

“By pivoting toward services, repairs, and mobile, and reducing its reliance on pure hardware sales, Currys is building a more resilient, higher-margin business model. This renewed sense of strategic clarity has restored confidence in a business that once looked close to the brink.”  

“But while the recovery so far has been impressive, the next chapter may be tougher. There are growing signs of consumer fatigue in the economy, and big-ticket electronics may struggle for share of wallet in a more cautious spending environment. Currys has proven it can adapt, but the turnaround story isn’t over, and while the next phase may prove more demanding, Currys is showing it’s better equipped to handle whatever comes next.” 

Greggs shares sank on Wednesday after the purveyor of the humble sausage roll issued a profit warning following a period of warm weather that knocked footfall in their outlets.

Greggs has cautioned that full-year operating profit could fall below 2024 levels, despite achieving solid sales growth in the first half of 2025.

Shares were down over 13% at the time of writing after the group outlined the impact of rising costs on profits and stuttering sales growth. Greggs shares are trading at the lowest levels since 2020.

The bakery chain reported total sales up 6.9% to £1.027 billion for the 26 weeks ended 28 June. Like-for-like sales grew 2.6%. However, the board now expects annual operating profit to be “modestly below” last year’s performance.

June’s weather proved challenging. Very high temperatures across the UK boosted demand for cold drinks but reduced overall footfall, slowing the company’s sales momentum after a strong May performance.

Refurbishment activity and cost recovery initiatives have been weighted toward the current first half, further impacting margins for the period.

“Greggs might be feeling the heat, but not in the way it hoped. The bakery chain this morning blamed the recent hot weather for softer sales in its latest trading update. Clearly feeling the heat, Greggs share price plummeted 13% and will leave investors wondering if something more serious is cooking,” said Mark Crouch, market analyst for eToro.

“For a brand that’s built its success on affordability and convenience, a dip in demand raises eyebrows, especially when footfall should be strong. Sure, it’s harder to sell a hot sausage roll in a heatwave, but a stretched consumer may be part of the bigger picture. Inflation may be easing, but wallets are still under pressure, and Greggs’ value proposition may be losing a bit of its bite.”

Greggs continues expanding aggressively. The company opened 87 new shops in the first half, closing 56 others for a net gain of 31 locations. Total shop count now stands at 2,649, comprising 2,085 company-managed stores and 564 franchised units.

Management remains confident of achieving 140 to 150 net openings for the full year. However, investors will be concerned that there are deeper issues for Greggs than a warm month of June.

Spectris shares rose on Wednesday as the bidding war for the company heats up with private equity firm KKR offering 4,000p per share in a cash acquisition of precision measurement company Spectris, valuing the business at approximately £4.1bn.

The offer tops a recent offer from Advent worth £3.8bn

The offer comprises 3,972p in cash plus a 28p interim dividend, representing a 6.3% premium to rival bidder Advent’s previous 3,763p per share offer and a 96.3% premium to Spectris’ closing price before the takeover period began.

Spectris shares were trading 5% higher at 4,030p at the time of writing. Shares trading above the offer prices suggest the market sees another offer coming in from Advent before long.

In the commentary attached to the offer details, KKR cited Spectris’ strong market position and growth potential as key drivers behind the acquisition.

The US buyout firm believes the company has opportunities to accelerate growth in attractive end markets that it cannot fully exploit as a listed business. This is a similar thesis to Advent’s and many other private equity takeovers of UK companies.

KKR plans to provide additional capital and expertise to drive longer-term expansion both organically and through acquisitions in what it describes as a fragmented market.

The deal values Spectris at 19.5 times its 2024 adjusted earnings before interest, tax, depreciation and amortisation.

The FTSE 100 was lower on Tuesday with investors in ‘wait and see’ mode amid trade talks between the US and major trading partners.

London’s leading index was 0.3% in the red at the time of writing, with housebuilders dragging the index lower despite reasonable gains for mining shares.

The German DAX was down 0.4% as European equity indices tracked US futures lower. The S&P 500 closed out the second quarter at a record high, but the impending risk events of the Non-Farm Payrolls on Thursday and trade talks sapped enthusiasm out of stocks as third-quarter 2025 trading got underway.

“Trade talk is heating up again as President Trump’s 90-day pause on reciprocal tariffs nears its end,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.

“Markets are starting to see that Trump’s bark is worse than his bite, with news that the White House might dial back its tariff plans to avoid reigniting a global trade war the latest example of a softer touch.”

Whether Trump’s ‘bark is worse than his bite’ will drive equity markets in the run-up to trade deadlines 8th and 9th July, and investors are showing the first signs of realigning their portfolio ahead of key announcements that are likley to be fired out via social media.

FTSE 100 Housebuilders

Housebuilding stocks weighed on the FTSE 100 on Tuesday after Nationwide revealed the average UK property price dropped in June as the stamp duty-induced boost to activity faded.

“Housebuilders retreated after disappointing housing data from Nationwide which said average UK prices fell by 0.8% month-on-month in June,” said Dan Coatsworth, investment analyst at AJ Bell.

“Housebuilders have been pinning their hopes on a more robust property market driven by lower mortgage rates. Changes to stamp duty in April might have simply caused a short-term blip in activity and it certainly doesn’t look as if the property market is going into a major decline.”

Persimmon, Taylor Wimpey and Barratt Redrow were all lower by more than 2%.

A weaker housebuilding sector offset gains for the miners that rallied after an upbeat assessment of the Chinese economy. The Caixin China General Manufacturing PMI rose to 50.4 in June after a 48.3 print in May. A reading above 50 signals expansion, while a reading below 50 signals contraction.

“Both supply and demand recovered,” said Dr. Wang Zhe, Senior Economist at Caixin Insight Group.

“Manufacturing production and sales returned to growth after a brief contraction in May. In June, amid improvements in the trade environment, manufacturers made efforts to promote sales, causing total new orders to return to expansion. This improved demand drove the recovery in supply, with the subindex for output rebounding by more than 4 points and moving into expansionary territory.

Miners cheered the positivity in China’s manufacturing sector with Antofagasta, Anglo American and Glencore among the FTSE 100 top risers.

There were also gains for precious metals miners Endeavour Mining and Fresnillo. Both stocks have thrived on investor uncertainty in the wake of Trump’s tariffs, and today’s gains reflect a hint of nervousness as key deadlines approach.