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London Stocks Slightly Lower Amid Mixed Inflation Data

London’s equity markets saw modest declines on Wednesday as investors digested mixed inflation figures, with services price inflation showing slower-than-expected easing despite headline inflation hitting the Bank of England’s target.


The blue-chip FTSE 100 edged down 0.1% to 8,180.42 points, while the mid-cap FTSE 250 remained flat at 20,410.28 points. The British pound gained 0.1% against the dollar, settling at $1.2728.


Investors grappled with May’s services price inflation, which registered at 5.7%, slightly above the 5.5% forecast in a Reuters poll. This data suggests ongoing domestic price pressures, influencing market expectations regarding the timing of a potential rate cut by the Bank of England.


“Markets are seeing a bit of indigestion on the details of the inflation report pushing back expectations of a first rate cut,” remarked Ben Laidler, global markets strategist at eToro.

According to Zara Nokes, global market analyst at J.P. Morgan Asset Management, “If this stickiness in domestic price pressures continues, alongside ongoing resilience in economic activity, an August rate cut could well be off the table too.”

Meanwhile, headline inflation returned to the Bank of England’s target of 2%, indicating a stable overall inflation environment.

The Bank of England is set to announce its policy decision on Thursday, with market attention keenly focused on its stance amid these inflation dynamics.

In individual stock movements, Segro declined by 1.2% following a downgrade from Jefferies to “hold” from “buy”. Spectris fell by 8.2% after the company warned of lower-than-expected profit due to weak demand from China. Telecom infrastructure firm Helios Towers led losses on the mid-cap index, dropping 8.4% after a discounted secondary share placement.

On a positive note, Anglo American gained 1.5% after forecasting a 30% decline at its key Chile copper mine in 2025, reflecting specific sectoral developments.

With U.S. markets closed for a public holiday, trading volumes in London were expected to be subdued.

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