London open: Stocks steady; UK inflation ticks higher in June
By Michele Maatouk
Date: Wednesday 16 Jul 2025
(Sharecast News) - London stocks were flat in early trade on Wednesday, as investors mulled an unexpected uptick in UK inflation last month.
At 0825 BST, the FTSE 100 was steady at 8,933.73.
Figures released earlier by the Office for National Statistics showed that annual inflation rose to 3.6% in June from 3.4% in May, versus expectations for it to remain unchanged. This marked the highest since January 2024, when it was 4.0%.
The ONS said transport, particularly motor fuels, made the largest upward contribution.
Food price inflation also increased for the third consecutive month, to 4.5% - its highest annual rate since February 2024.
Core inflation - which excludes energy, food, alcohol and tobacco - increased to 3.7% from 3.5%. Analysts were expecting it to remain unchanged.
ONS acting chief economist Richard Heys said: "Inflation ticked up in June driven mainly by motor fuel prices which fell only slightly, compared with a much larger decrease at this time last year.
"Food price inflation has increased for the third consecutive month to its highest annual rate since February of last year. However, it remains well below the peak seen in early 2023."
Martin Sartorius, principal economist at the Confederation of British Industry, said: "June's stronger-than-expected inflation print will raise concerns that recent price pressures - driven by higher household energy prices and the passthrough of increased employment costs - could potentially re-entrench inflation in the economy.
"While we still expect the Bank of England's Monetary Policy Committee to continue gradually cutting rates, today's upside inflation surprise means its August decision will be finely balanced. Underlying price pressures show signs of easing as the labour market cools, which should support a rate cut. However, some members of the MPC will be wary of loosening too quickly and, consequently, risk inflation remaining above target for longer."
In equity markets, Rio Tinto jumped to the top of the FTSE 100 as it revealed that US tariffs added $300m in first-half costs on aluminium exports from Canada, but also said that annual copper output would be at the higher end of estimates.
Rio said that while a "substantial" part of the extra cost was offset by higher premiums on US sales when the 25% tariff was introduced in March, the premium could no longer fully compensate when President Donald Trump doubled duties on Canadian aluminium to 50% in June.
The mining giant also said annual copper production was now expected to be at the higher end of estimates after a 13% rise in output during the second quarter due to the successful ramp up of the Oyu Tolgoi underground mine and good performance at Escondida.
Elsewhere, Hiscox jumped after an upgrade to 'overweight' by Morgan Stanley.
Chilean copper miner Antofagasta gained as it said copper production rose 3% quarter-on-quarter in the second quarter, and 11% year-on-year in the first half. Gold production was also higher.
Intermediate Capital Group rallied as it said assets under management rose 3% in the first quarter to $123bn, with fee-earning AUM up 4% to $82bn.
On the downside, recruiter Hays was knocked lower by a downgrade to 'underweight' at Morgan Stanley.
Market Movers
FTSE 100 (UKX) 8,933.73 -0.05%
FTSE 250 (MCX) 21,651.81 -0.18%
techMARK (TASX) 5,145.22 -0.35%
FTSE 100 - Risers
Rio Tinto (RIO) 4,421.50p 1.74%
Hiscox Limited (DI) (HSX) 1,262.00p 1.61%
Fresnillo (FRES) 1,490.00p 1.36%
Antofagasta (ANTO) 1,858.00p 1.03%
Airtel Africa (AAF) 185.60p 0.87%
Imperial Brands (IMB) 2,927.00p 0.83%
HSBC Holdings (HSBA) 925.00p 0.59%
Intermediate Capital Group (ICG) 1,987.00p 0.51%
British American Tobacco (BATS) 3,836.00p 0.47%
International Consolidated Airlines Group SA (CDI) (IAG) 378.90p 0.45%
FTSE 100 - Fallers
CRH (CDI) (CRH) 7,000.00p -1.60%
Ashtead Group (AHT) 4,734.00p -1.44%
Smurfit Westrock (DI) (SWR) 3,385.00p -1.28%
AstraZeneca (AZN) 10,362.00p -1.28%
Spirax Group (SPX) 5,965.00p -1.24%
Melrose Industries (MRO) 524.80p -1.02%
Pershing Square Holdings Ltd NPV (PSH) 4,138.00p -1.00%
Bunzl (BNZL) 2,278.00p -0.87%
Mondi (MNDI) 1,176.50p -0.84%
Rentokil Initial (RTO) 341.20p -0.84%
FTSE 250 - Risers
Bridgepoint Group (Reg S) (BPT) 345.00p 2.92%
Lion Finance Group (BGEO) 7,305.00p 2.60%
Ibstock (IBST) 154.60p 2.25%
Bytes Technology Group (BYIT) 337.20p 2.18%
Baillie Gifford Japan Trust (BGFD) 815.00p 1.88%
Kier Group (KIE) 206.00p 1.48%
TBC Bank Group (TBCG) 4,930.00p 1.34%
Foresight Group Holdings Limited NPV (FSG) 462.00p 1.20%
GCP Infrastructure Investments Ltd (GCP) 76.90p 1.18%
Ninety One (N91) 191.90p 0.84%
FTSE 250 - Fallers
Moonpig Group (MOON) 201.50p -4.73%
Hays (HAS) 64.50p -4.09%
Petershill Partners (PHLL) 228.00p -3.80%
Discoverie Group (DSCV) 682.00p -3.12%
Volution Group (FAN) 598.00p -3.08%
CMC Markets (CMCX) 235.00p -2.49%
Vesuvius (VSVS) 382.80p -2.20%
Indivior (INDV) 1,127.00p -2.09%
Baillie Gifford US Growth Trust (USA) 248.00p -1.98%
Morgan Advanced Materials (MGAM) 225.50p -1.96%
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