Markets Overview:

The UK 100 called to open +4 points this morning at 9,140. The UK 100 looks set to test all time highs once again at the open, this comes after the UK’s bluechip index struck an all time high yesterday.

Stateside yesterday saw the S&P close lower as progress on trade talks with Beijing stalled and traders braced for the Federal Reserve’s rate decision.  The broad market index lost 0.30%, ending at 6,370.86. The Nasdaq slipped 0.38%, settling at 21,098.29. Both indexes touched fresh all-time highs earlier in the day. The Dow Jones fell 204.57 points, or 0.46%, to close at 44,632.99. Selling pressure intensified in the final hour of trading, at one point bringing the S&P 500 to its session low

Company News & Broker Comments:

Company News:

BAE Systems today upgraded its sales and earnings guidance after reporting a strong operational performance in the first half of the year.  The defence group now expects a 2025 sales increase in the range of 8-10%, up from previous guidance of 7-9% and compared with last year’s total of £28.3 billion.  Underlying earnings growth is forecast in the range of 9-11%, having posted a figure of £3 billion in 2024.  Sales in the first half of the year rose 11% to £14.6 billion, while underlying earnings lifted 13% to £1.55 billion. It secured £13.2 billion of orders in the period, alongside progress executing on long-term major programmes.

Glencore on Wednesday reported lower copper production in the first half, and said it aims to save $1 billion in costs by the end of 2026, as part of a review of its industrial assets.  Glencore also revised its long-term full-year marketing earnings before interest and taxes (EBIT) to $2.3 billion to $3.5 billion this year, from $2.2 billion to $3.2 billion previously, after the completion of the sale of its agribusiness Viterra in July, which contributed around $200 million to it.

GSK said on Wednesday it expects to report annual sales and profit towards the top end of its forecast range, after the British drugmaker beat expectations for second-quarter sales and earnings, bolstering the company’s bid to reignite growth.  The company is focusing on expanding its drug pipeline, particularly in infectious diseases, to offset declining sales of top drugs and vaccines as demand slows and competition increases, and meet its long-term sales target.

HSBC has warned that it expects lending to “remain muted” for the rest of 2025 after posting lower-than-expected profits for the first half of the year.  The surplus fell by $5.7 billion (£4.3 billion) from the first half of 2024 to $15.8 billion (£11.8 billion).  HSBC attributed $3.6 billion (£2.7 billion) of the decline to the sale of its Argentina and Canada operations while “dilution and impairment losses” on its stake in China’s Bank of Communications accounted for $2.1 billion (£1.6 billion).  Constant currency profit excluding one-off items increased by $900 million (£674 million) to $18.9 billion (£14.2 billion), with a strong performance in international wealth and premier banking and HSBC’s Hong Kong business segments cited.  Chief executive Georges Elhedery said: “We’re making positive progress in becoming a simple, more agile, focused organisation built on our core strengths.  He added: “We continue to navigate this period of economic uncertainty and market volatility from a position of strength, putting the changing needs of our customers at the heart of everything we do.”  HSBC announced a second interim dividend of 10 US cents a share, while it also intends to initiate a share buyback of up to $3 billion (£2.25 billion).

Rio Tinto reported its smallest first-half underlying profit in five years on Wednesday, as iron ore prices remained subdued due to oversupply concerns and soft China demand, offsetting higher earnings from its copper business.  Iron ore prices eased in the first half of the year as steel production in top consumer China declined and more supply from Australia, Brazil, and South Africa came to the global market, denting Rio Tinto’s earnings from the steel-making raw material.  Rio Tinto Chief Executive Jakob Stausholm said: “We are delivering very resilient financial results with an improving operational performance helped by our increasingly diversified portfolio. Underlying EBITDA of $11.5 billion and operating cash flow of $6.9 billion, despite a 13% lower iron ore price, demonstrate the growing contribution from our Aluminium and Copper businesses and our Pilbara operations’ strong recovery from the four cyclones in the first quarter. We are reporting underlying earnings of $4.8 billion (after taxes and government royalties of $4.8 billion).  “Our strong cash flow enables us to maintain our practice of a 50% interim payout with a $2.4 billion ordinary dividend, as we continue our disciplined investment in profitable growth while retaining a strong balance sheet.  “We are well positioned to generate value from our best-in-class project execution, together with growing demand for our products, now and over the coming decades. We remain on track to deliver strong mid-term production growth, with solid foundations in place and a diverse pipeline of options for the future.”

Taylor Wimpey posted a double-digit rise in housing completions, but a £222.2m hit from fixing combustible cladding pushed the company to a half-year loss.  The number of houses built in the first half of 2025 totalled 5,264, up from 4,728 last year, the company told markets this morning.  Revenue rose nine per cent to £1.65bn, with “robust” trading in the first quarter followed by softer trading in the second.  However, Taylor Wimpey recorded a loss before tax of £92m, turning around a £99m profit last year.  This was largely down to an increase in the company’s fire safety provision to £222.2 million after a reassessment of its risk exposure on getting building up to a fire-safe standard post-Grenfell.  “We have long maintained that leaseholders should not bear the cost of fire safety remediation, and our focus has always been on ensuring that residents in Taylor Wimpey buildings have a clear path to resolution,” the company said.

Reporting Today:

UK

BAE Systems (BA.)

HSBC Holdings (HSBA)

Rathbones Group (RAT)

Rio Tinto (RIO)

Taylor Wimpey (TW.)

GSK (GSK)

US

Automatic Data Processing (ADP) PMO

Etsy (ETSY) PMO

Fiverr International (FVRR) PMO

The Kraft Heinz Co (KHC) PMO

Takeda Pharmaceutical (TAK) PMO

ARM Holdings (ARM) AMC

Ford Motor (F) AMC

Markel Group (MKL) E

Meta Platforms (META) AMC

Microsoft Corp (MSFT) AMC

Qualcomm Inc (QCOM) AMC

Reporting Tomorrow:

UK

Aberdeen Group (ABDN)

Anglo American (AAL)

British American Tobacco (BATS)

Elementis (ELM)

Endeavour Mining (EDV)

Haleon (HLN)

Hammerson (HMSO)

London Stock Exchange Group (LSEG)

Mondi (MNDI)

Rentokil Initial (RTO)

Rolls Royce Holdings (RR.)

Schroders (SDR)

Segro (SGRO)

Shell (SHEL)

St James’ Place (STJ)

Standard Chartered (STAN)

Unilever (ULVR)

US

AbbVie (ABBV) PMO

Bristol-Myers Squibb (BMY) PMO

Mastercard (MA) PMO

Willis Towers Watson (WTW) PMO

Amazon.com (AMZN) AMC

Apple Inc (AAPL) AMC

Cloudflare (NET) AMC

Illumina (ILMN) AMC

Riot Platforms Inc (RIOT) AMC

Strategy (MSTR) AMC

In Focus Today:

German Gross Domestic Product

German Retail Sales

EU Business Climate

EU Consumer Confidence

EU Economic Sentiment Indicator

EU Gross Domestic Product

US ADP Employment Change

US Gross Domestic Product

US Personal Consumption Expenditures Prices

US Pending Home Sales

Fed Interest Rate Decision

Fed Monetary Policy Statement

FOMC Press Conference

Tomorrow’s Ex-Dividends:

UK 100 companies going ex-dividend on 31st July 2025:

Lloyds Banking Group

UK 250 companies going ex-dividend on 31st July 2025:

HICL Infastructure

MONY Group

Brunner Investment Trust

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