UK equity markets opened on a cautious footing Friday, with the FTSE 100 clinging to marginal gains of 0.1% as investors digest Thursday’s Bank of England rate decision, a strong retail sales print, and continued political noise around Downing Street.
The FTSE 250 has slipped 0.2%, while European bourses fare better, with the DAX adding 0.5%, the CAC 40 up 0.3%, and the Euro Stoxx 50 having gained 0.2%.
BoE Holds
The Bank of England voted 7-2 to keep rates at 3.75% on Thursday, amid easing geopolitical pressures following the US-Iran truce and May inflation data.
UK Retail Sales Beat Forecasts
Fresh ONS data offered some cheer on Friday, with UK retail sales having risen 1.2% month-on-month in May, with an annual gain of 3.2%.
Warm weather and retailer promotions drove footfall and spending, suggesting consumer resilience.
Labour Uncertainty Lingers
Political risk remains a backdrop for UK markets…
Andy Burnham has won the Makerfield by-election, potentially setting up a showdown with current Prime Minister Sir Keir Starmer over the Labor leadership. Burnham is widely expected to make a bid for the leadership position and the job of prime minister, with Starmer facing sustained pressure.
PPHE Dives
The biggest story is PPHE Hotel Group (LON: PPH), which has crashed by around 19% after the collapse of Fattal Hotels’ £921 million takeover approach, pitched at £22 per share.
A major shareholder blocked the deal, with the independent committee concluding the offer was inadequate. A painful outcome for investors banking on a premium exit.
Risers & Fallers
On the upside, AstraZeneca (+1.57%) benefits from a defensive rotation into pharma amid the cautious tone.
Babcock (+1.55%) has gained, while BP (+1.48%) has moved higher despite the US-Iran deal and the reopening of the Strait of Hormuz easing supply anxiety.
Among fallers, Admiral (-5.77%) leads declines after RBC issued a downgrade this morning.
Lloyds (-1.56%) has softened, while United Utilities (-1.46%) has also retreated.
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