Weekly review
By Michele Maatouk
Date: Friday 31 Jul 2026
(Sharecast News) - The FTSE 100 ended down 0.3% at 10,868.05 on Friday.
Equity view
NatWest on Friday reported strong half-year earnings driven by a jump in net interest income. Profit for the half-year to June 30 rose 19% to £3.1bn with net interest income up 12% to £6.9bn. The bank said it was expecting a return on tangible equity of more than 19% for the full year and would consider share-buybacks from full year 2026, six months earlier than previously planned.
BA and Iberia owner IAG reported a drop in first-half profit on Friday as the war in the Middle East caused fuel costs to surge, and said it no longer expects any capacity growth this year. In the six months to the end of June, profit after tax fell 20.6% to €1bn, while operating profit declined 14.4% to €1.6bn. Total revenue nudged up 1% to €16bn and IAG said this was a "resilient" revenue performance despite lower capacity than planned.
Energy major Shell has launched a $3bn share buyback on Thursday after more than doubling profits in the second quarter as oil prices soared and upstream production hit record levels in Brazil. The company reported adjusted earnings of $9.84bn for the three months to 30 June, ahead of the $6.92bn recorded in the first quarter and the $4.26bn reported the year before.
Lloyds Banking Group held annual guidance on Thursday after a 23% jump in half-year profits driven by higher net interest income and announced a £1bn share buyback. Pre-tax profit rose to £4.3bn in the six months to June 30 benefiting from higher total income and controlled costs, which were partially offset by higher charges for operating lease depreciation and impairment, Lloyds said on Thursday.
BAE Systems upgraded its full-year guidance on Thursday as it reported a jump in first-half profit as governments ramped up defence investments. In the six months to 30 June, underlying earnings before interest and tax rose 11% to £1.7bn, while sales were up 9% at £15.7bn, with all sectors contributing to growth.
Rentokil Initial tumbled on Thursday after the pest control firm ditched its margin target for North America and said it had seen some weakness in residential lead flow in the region towards the end of the second quarter and into July. The company said it was "retiring" its NA margin target of 20% in 2027 as it focuses on "driving volume growth over short-term margin expansion".
Bakery chain Greggs reported a rise in first-half profit and sales on Wednesday despite "subdued consumer confidence and increased uncertainty", as it pointed to growth in the grocery business and strong cost control. In the 26 weeks to 27 June, pre-tax profit jumped 19.7% from the same period a year earlier to £76m, while operating profit was up 22.9% at £86.5m. Total sales came in at £1.1bn, up from £1.0bn.
Consumer goods giant Reckitt delivered a "strong" second quarter on Wednesday with broad‑based acceleration, prompting the group to reiterate its full‑year outlook as momentum improved across regions, categories and its Mead Johnson Nutrition arm.
Standard Chartered announced the launch of a $1bn share buyback on Wednesday and lifted its full-year income target at it posted better-than-expected first-half profit. In the six months to the end of June, pre-tax profit jumped to a record $4.8bn from $4.4bn in the same period a year earlier, beating analysts' expectations of $4.5bn.
Mining giant Rio Tinto on Wednesday reported a jump in first‑half profit driven by higher metals prices and demand. Underlying earnings for the six months to June 30 climbed 43% to $6.9bn, further driven by $870m in productivity gains. Free cash flow surged 75% year on year to $3.8bn.
Shares in Barclays fell 5% on Tuesday despite the UK bank delivering a better than expected 17% jump in half-year profits driven by higher income in its global markets division and investment banking fees. Pre-tax profit for the six months to June 30 came in at £6bn, beating forecasts of £5.94bn, while group income increased 11% to £16.5bn boosted by higher structural hedge income and a one-off £225m gain from the sale of the American Airlines credit card portfolio. Barclays also announced a £1bn share buyback.
Miniatures wargames manufacturer Games Workshop reported record full-year revenue and pre-tax profit on Tuesday, citing a "good" performance from the core business. In the year to the end of May, pre-tax profit rose to £275.7m from £262.8m the year before, on revenue of £659.7m, up from £617.5m. Core revenue increased 10.9% to £626.8m but licensing revenue declined - as expected following the launch of Space Marine 2 in the prior year - to £32.9m from £52.5m.
Man Group reported record assets under management on Tuesday, with net inflows ahead of the industry. In the six months to the end of June, assets under management rose to $253.6bn from $227.6bn at the end of December 2025. Man Group highlighted a positive investment performance of $19.8bn, up 0.4% relative to peers, and net inflows of $7.1bn, 3.4% ahead of the industry.
Consumer goods giant Unilever boosted its full-year outlook on Tuesday, following a bumper end to the first-half. The owner of Dove, Lynx and Persil, among many others, said underlying sales growth in the six months to June end had risen 4.8%, driven by robust performances in both homecare and beauty and wellbeing. Company-wide volumes sparked 4.2% and prices 0.6%. Operating profits were 2.6% higher at €4.9bn.
Telecoms operator Vodafone said on Monday that it expected full-year earnings to be at the upper end of guidance after a strong first quarter performance including a contribution from Safaricom. Adjusted earnings before interest, taxes, depreciation, amortisation and leases rose 6.7% to €2.9bn. The company on Monday said it expected the annual figure to be at the top end of the €13bn - 13.3bn revised guidance provided in May.
HSBC announced on Monday that it will hire more than 100 artificial intelligence specialists as part of plans to expand the adoption of AI across its global operations. The banking giant said that the new roles would support a Global AI Centre of Excellence in Singapore, due to launch in the second half of 2026. The centre will develop AI capabilities that can be scaled across HSBC's international network.
Energy sales and distribution firm DCC Energy said on Monday that Energy Capital Partners and KKR had agreed to acquire it in a cash deal worth up to £5.75bn.
Economic news
The Bank of England kept interest rates unchanged on Thursday, as widely expected, although three policymakers voted for tighter monetary policy amid concerns over energy prices and persistent inflationary pressures. The nine-person Monetary Policy Committee voted six to three to maintain Bank Rate at 3.75%, with Megan Greene, Catherine Mann and Huw Pill preferring a 25-basis-point rise to 4%.
UK mortgage approvals ticked higher in June, according to data released on Wednesday by the Bank of England. The latest monthly Money and Credit report showed that net mortgage approvals for house purchases rose to 58,200 from 56,600 in May. Net borrowing of mortgage debt rose to £7.7bn from £3.3bn in May, coming in above the previous six-month average of £4.9bn.
Shop price inflation cooled in July, industry research showed on Tuesday, giving consumers some respite from mounting cost of living pressures. According to the latest BRC-NIQ shop price monitor, shop price inflation was 0.9% year-on-year this month, down from June's 1.2%. Month-on-month it dipped 0.1%.
The downturn in the UK retail sector eased in the six months to July, according to the latest survey released by the Confederation of British Industry on Monday. The CBI's headline distributive trades balance rose to -26 from -54 in June, although sales are expected to fall at a similar pace next month. A balance is the weighted difference between the percentage of firms reporting an increase and those reporting a decrease. Retail sales for the time of year were judged to be "poor" in July, albeit to a considerably lesser extent than in June, with a balance of -18, versus -40.
International events
The Bank of Japan on Friday left its benchmark interest rate unchanged as expected, keeping borrowing costs at 1% after last month's hike, amid heightened speculation the government intervened to support the yen. Board member Hajime Takata dissented, arguing for a further rate rise to address potential upward price pressures. The move came after the yen abruptly strengthened on Thursday night, jumping from around 162.80 to the 157 level against the dollar in roughly an hour - a shift analysts said strongly suggested action by Japanese financial authorities.
Consumer price inflation across the eurozone accelerated in July, according to preliminary estimates released on Friday by Eurostat, as energy prices turned higher once again. The annual change in the harmonised consumer price index climbed to 2.9% from 2.8% in June, in line with analysts' expectations.
Eurozone economic growth accelerated in the second quarter, while the bloc's unemployment rate remained stable in June, according to figures released by Eurostat on Thursday. Seasonally adjusted gross domestic product increased 0.4% during the three months to June compared with the previous quarter, when output was unchanged. On an annual basis, the euro-area economy expanded 1.0%, accelerating from growth of 0.5% in the first quarter.
America's goods trade deficit narrowed in June, while wholesale inventories continued to rise, according to preliminary figures from the Census Bureau on Tuesday, offering a mixed picture of underlying demand and supply‑chain conditions across the US economy. Preliminary figures showed the goods trade gap shrinking to $101.5bn from a 14‑month high of $105.9bn in May.
Business sentiment across Germany improved to a five-month high in July, according to the IFO Institute on Monday, with companies turning less pessimistic despite ongoing geopolitical uncertainty. The IFO's business climate index rose 86.6 points in July, up from 85.7 points in June, with forward-looking sentiment picking up significantly.
China's industrial firms reported slower profit growth in June as strong export demand continued to offset weak domestic conditions, underlining the patchy nature of the country's recovery. Industrial profits rose 15.1% year‑on‑year in June, easing from 21.1% in May, according to the National Bureau of Statistics on Monday, while first‑half profits were up 18.7%, little changed from the January to May period.
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