London’s blue-chip index ended Friday’s session in negative territory, dragged lower by weakness across mining and pharmaceutical stocks.
The FTSE 100 closed down 22.56 points, or 0.2%, finishing the session at 10,750.11, capping an uninspiring week for large-cap London equities.
The FTSE 250, however, managed modest gains, ending up 29.71 points, or 0.1%, at 24,867.42, while the AIM All-Share also edged higher to close at 800.92.
For the week as a whole, the FTSE 100 dropped 1.4%, while the FTSE 250 gained 0.1% and the AIM All-Share advanced 0.3%.
David Morrison, senior analyst at Trade Nation, warned that downside momentum appears to be building across London markets, raising concern among investors about the near-term outlook.
“These pullbacks mark a pause in a sustained summer rally that had pushed European indices to record highs,” Morrison said, acknowledging the broader context behind the recent weakness.
Morrison added that “much may depend on what happens to US indices,” noting that softer inflation data and disappointing payroll figures have already dialled back expectations for Federal Reserve rate hikes.
“European investors are keeping a close eye on energy prices, especially as the summer edges to its conclusion,” Morrison said, highlighting an additional source of uncertainty for the region.
Across Europe, the CAC 40 in Paris closed down 0.2%, while Frankfurt’s DAX 40 bucked the trend and rose 0.5%, illustrating the uneven trading conditions across the continent.
Adding to the cautious mood, US retail and food services sales declined 0.6% month-on-month in July to 763.6 billion US dollars, against a consensus expectation of 0.1% growth, according to US Census Bureau data.
The surprise retail sales drop amplified debate around interest rate policy, with the CME FedWatch tool placing a 69% probability that the Federal Reserve will leave rates on hold at its September meeting.
Ksenia Bushmeneva, economist at TD Economics, suggested that US consumer spending is transitioning from the weather and tax-refund-driven rebound seen in the second quarter to a more moderate pace of growth in the third.
The pound strengthened against the dollar, trading at 1.3550 US dollars on Friday afternoon, up from 1.3498 dollars at Thursday’s equities close, as the greenback faltered across the board.
In corporate news, Aviva gained 1.8% after reporting first-half operating profit of £1.33 billion, topping the Visible Alpha consensus of £1.25 billion for the six months ended June 30.
RBC Capital Markets analyst Ben Cohen said the profit beat was driven by the UK and Ireland General Insurance business, which came in 6% ahead of consensus, describing the overall results as a “small positive.”
Entain rose 2.1% as investors took a more positive view of Thursday’s results, with the Ladbrokes owner having reported better-than-expected revenue figures.
Antofagasta fell 4.6% for the second consecutive session following Thursday’s lowered production guidance, while GSK and AstraZeneca both dropped 2.1%.
GB Group shares collapsed 31% after the Chester-based identity verification company slashed its revenue growth guidance to between 1% and 3% for the financial year ending March 2027, down from a previous forecast of mid-single-digit percentage growth.
Shore Capital analyst Alasdair Young called the announcement “disappointing given management reported Q1 trading in line with expectations three weeks ago,” adding that it raises “legitimate questions over whether competitive pressures in Americas Identity are greater than previously appreciated.”
On the FTSE 250, recruiters Michael Page and Hays surged 5.5% and 5.3% respectively, with Page lifted by a UBS upgrade to “buy” from “neutral” and a price target increase to 235p from 180p.
Defence technology firm Cohort climbed 6.1% on AIM after securing a 140.7 million euro contract from Saab to deliver integrated sonar systems for the Polish Orka submarine programme, with deliveries expected to continue into the mid-2030s.