LONDON (ShareCast) - (Sharecast News) - London equities ended Thursday in mixed territory, as investors digested US president Donald Trump declaring a US-UK trade deal, while the Bank of England delivered an expected interest rate cut.
The FTSE 100 index slipped 0.32% to close at 8,531.61 points, while the FTSE 250 rose 0.59% to 20,457.15 points.

In currency markets, sterling was last down 0.21% on the dollar, trading at $1.3264, while it gained 0.46% against the euro to change hands at €1.1815.

"Over the past 24 hours both the Fed and the Bank of England have warned that the outlook for their respective economies is worsening, though the former seems in no hurry to cut rates while the latter's divided policy committee indicates that rate cuts may continue at a slower than expected pace," said IG chief market analyst Chris Beauchamp.

"Despite this, stock markets around the globe continue to edge higher, though at a far more measured pace than was the case in April.

"Risk appetite remains fragile, since investors remain on watch for signs that a recession is beginning to appear in the data."

Beauchamp noted that over the last fortnight, the mid-cap FTSE 250 had overtaken the FTSE 100 in its rebound from the April low.

"Worries about some of the latter's heavyweight dividend payers have hobbled the FTSE 100, but at least UK-focused firms can breathe easier now that the US and UK have signed a framework trade deal."

BoE cuts rates as expected, as Trump announces US-UK trade deal

In central bank news, the Bank of England cut interest rates for the second time this year at lunchtime, lowering the benchmark rate by 25 basis points to 4.25% in a closely divided vote.

The Monetary Policy Committee backed the move by a narrow 5-4 margin, with two members pushing for a larger cut and two voting to keep rates unchanged.

It marked the fourth cut since the BoE began reversing its aggressive tightening cycle prompted by post-pandemic inflation.

Officials cited the need for a "gradual and careful" easing of policy amid persistent uncertainties, including global trade tensions.

The rate decision followed the announcement of a new US-UK trade deal, which could impact the economic outlook but remains short on detail.

While US president Donald Trump called the agreement "full and comprehensive" in a post on Truth Social, UK officials offered no confirmation beyond acknowledging ongoing talks.

Analysts believed the deal would focus on tariff reductions for key exports such as cars and steel, rather than constituting a broader free trade agreement.

In economic news, UK housing data painted a mixed picture.

Lender Halifax reported a modest 0.3% increase in average house prices in April - the first monthly gain since January - lifting annual growth to 3.2%.

"We know the stamp duty changes prompted a surge in transactions in the early part of this year, as buyers rushed to beat the tax-rise deadline," said Amanda Bryden, head of mortgages at Halifax.

"However, this didn't lead to a significant increase in property prices, with the last six months characterised by a stability in prices rarely seen since the pandemic.

"While the market has cooled slightly since this rush, buyer activity remains strong in comparison to recent years."

However, a separate survey from the Royal Institution of Chartered Surveyors showed continued weakness in market activity.

Buyer interest and agreed sales both fell sharply, suggesting the broader housing market remains under pressure from economic uncertainty and policy changes.

"Although geopolitical developments haven't helped the mood music in the residential market over the past month, the main reason for the dip in key RICS sales activity metrics lies in the expiry of the stamp duty holiday at the end of March," said Simon Rubinsohn, chief economist at RICS.

"Near-term indicators suggest the subdued trend will persist for the next few months at least, but looking beyond this, the results are more encouraging, reflecting in part the prospect of deeper interest rate cuts than previously anticipated."

Across the Atlantic, weekly jobless claims in the US dropped more than expected to 228,000, reversing a recent spike and indicating a still-resilient labour market.

Continuing claims also fell, and the insured unemployment rate edged down to 1.2%.

However, first-quarter productivity data painted a more concerning picture, as non-farm labour productivity declined 0.8% on an annualised basis, with output falling as firms faced weaker demand, partly due to a spike in pre-tariff imports.

Unit labour costs rose at a 5.7% pace, suggesting ongoing wage pressures.

In Europe, Germany posted stronger-than-expected export growth in March.

Shipments rose 1.1% on the month, pushing the trade surplus to €21.1bn, up from €18bn in February, offering a sign of resilience in Europe's largest economy amid ongoing global trade disruptions.

Engineering and construction plays rise, Playtech tumbles as it goes ex-div

On London's equity markets, engineering company Renishaw surged 18.6% after narrowing its full-year revenue and profit guidance and highlighting strong momentum heading into the final quarter.

IMI also advanced, rising 5.13% after the firm reaffirmed its full-year outlook, reassuring investors amid broader market uncertainty.

Weir Group gained 4.07% following an upgrade to 'buy' from 'neutral' at UBS, which also raised its price target to 2,850p from 2,250p.

Building materials supplier Grafton Group climbed 5.7% as it reported a 7.8% rise in group revenue over the first four months of the year, supported by the recent acquisition of Salvador Escoda in Spain.

Harbour Energy jumped 7.32% after lifting its production forecast, just a day after announcing a 250-job cut in Aberdeen as part of a restructuring plan.

Packaging group Mondi rose 2.59% on the back of a first-quarter trading update, while InterContinental Hotels Group added 1.88% after affirming it remains on track to meet full-year profit expectations.

Retailer Next edged up 0.57% as it raised its profit guidance for the year following stronger-than-expected first-quarter sales, boosted by warmer weather, although full-year revenue forecasts remained flat.

On the downside, Playtech tumbled nearly 60% as shares traded ex-dividend, removing eligibility for its latest payout.

TBC Bank Group dropped 9.77% after releasing its first-quarter results.

Airtel Africa slid 8.4% following a decline in full-year underlying earnings, while Centrica fell 7.45% after warning that unseasonably warm weather had dented performance in its residential energy division.

Flutter Entertainment also came under pressure, losing 0.46% after adverse US sports outcomes impacted its first-quarter results.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 8,531.61 -0.32%
FTSE 250 (MCX) 20,457.15 0.59%
techMARK (TASX) 4,647.17 1.02%

FTSE 100 - Risers

Melrose Industries (MRO) 470.70p 5.21%
IMI (IMI) 1,885.00p 5.13%
Weir Group (WEIR) 2,408.00p 4.07%
Smurfit Westrock (DI) (SWR) 3,122.00p 4.03%
Rolls-Royce Holdings (RR.) 794.00p 3.66%
Whitbread (WTB) 2,823.00p 3.03%
Barclays (BARC) 305.05p 3.01%
Associated British Foods (ABF) 2,028.00p 2.87%
Spirax Group (SPX) 6,150.00p 2.76%
Intermediate Capital Group (ICG) 1,978.00p 2.65%

FTSE 100 - Fallers

Airtel Africa (AAF) 156.00p -8.40%
Centrica (CNA) 147.05p -7.57%
AstraZeneca (AZN) 10,134.00p -3.52%
Severn Trent (SVT) 2,672.00p -3.15%
Land Securities Group (LAND) 592.00p -2.39%
BT Group (BT.A) 162.50p -2.37%
Imperial Brands (IMB) 3,081.00p -2.35%
United Utilities Group (UU.) 1,105.50p -2.34%
Fresnillo (FRES) 1,030.00p -2.28%
Rio Tinto (RIO) 4,445.00p -2.08%

FTSE 250 - Risers

Renishaw (RSW) 2,710.00p 18.60%
Aston Martin Lagonda Global Holdings (AML) 79.00p 13.86%
Oxford Nanopore Technologies (ONT) 130.90p 9.63%
Harbour Energy (HBR) 169.70p 7.32%
Grafton Group Ut (CDI) (GFTU) 986.40p 5.70%
Ithaca Energy (ITH) 136.20p 4.93%
Kainos Group (KNOS) 792.50p 4.55%
Oxford Instruments (OXIG) 1,798.00p 4.41%
Just Group (JUST) 146.60p 4.28%
Kier Group (KIE) 162.00p 3.98%

FTSE 250 - Fallers

Playtech (PTEC) 320.50p -59.94%
TBC Bank Group (TBCG) 4,385.00p -9.77%
Trainline (TRN) 249.80p -7.07%
Raspberry PI Holdings (RPI) 467.40p -3.35%
GCP Infrastructure Investments Ltd (GCP) 71.50p -3.25%
RHI Magnesita N.V. (DI) (RHIM) 3,085.00p -2.99%
Safestore Holdings (SAFE) 634.00p -2.98%
Petershill Partners (PHLL) 214.00p -2.95%
HGCapital Trust (HGT) 510.00p -2.67%
JPMorgan Indian Investment Trust (JII) 989.00p -2.66%

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