UK stocks edged lower on Wednesday morning as inflation eased more than forecast and Bunzl slumped on a downbeat trading update.
Meanwhile, trade disputes between the US and China continue. Bloomberg previously reported that Beijing has ordered airlines not to take further deliveries of jets from US aviation major Boeing. More recently, Trump ordered a probe that may result in tariffs on critical minerals, rare-earth metals - for which China dominates global supply chains - and associated products such as smartphones.
The imports targeted include so-called critical minerals like cobalt, lithium and nickel, rare-earth elements, as well as products that partly require these resources, such as electric vehicles and batteries.
Meanwhile in the UK, data from the Office for National Statistics showed the consumer price index rose 2.6% in the 12 months to March, slowing from 2.8% in February and below the 2.7% FXStreet-cited market consensus expectation.
The sharpest downward contributions to annual inflation came from the recreation and culture, housing and household services, and transport categories.
The FTSE 100 index opened down 16.08 points, 0.2%, at 8,233.04. The FTSE 250 was down 86.29 points, 0.5%, at 19,181.65, and the AIM All-Share was up 0.02 points at 666.03.
The Cboe UK 100 was down 0.2% at 819.47, the Cboe UK 250 was down 0.2% at 16,781.37, and the Cboe Small Companies was marginally higher at 15,143.12.
Barratt Redrow was among the FTSE 100 leaders, up 0.9%.
The Leicestershire, England-based housebuilder reported a ‘solid’ private reservation performance in the 13 weeks to March 30, and said it remains on track to deliver 16,800 to 17,200 home completions for the full year.
Bunzl was by far the index’s worst performer, plummeting 26%.
Chief Executive Officer Frank Van Zanten said he was ‘disappointed with our performance in the first quarter in this challenging trading environment’.
The international distribution services company reduced its 2025 guidance to reflect various operational challenges, now expecting ‘moderate revenue growth’ and an operating margin ‘moderately below 8.0%’.
First-quarter revenue rose 0.8% or 2.6% at constant currency, but adjusted operating profit ‘was down significantly year-on-year in the first quarter, reflective of an operating margin decline driven by performance in North America and Continental Europe’.
Oxford Instruments led the FTSE 250, up 6.1%.
For the year ended March 31, the Oxfordshire-based provider of scientific technology and services said revenue growth ‘has been strong, as anticipated’ in its second half. Consequently, it expects full-year revenue growth of around 6% or 9% at constant currency.
It also expects its full-year adjusted operating profit to rise by 3% or by around 13% at CER, ‘in line with market expectations’.
Over on AIM, Oracle Power jumped 15%.
The Australia and Pakistan-focused minerals and power projects developer said it and China Electric Power and Technology Co Ltd have renewed their strategic memorandum of understanding for work on the Green Hydrogen project in Thatta, Pakistan.
The renewed MoU covers the next two years until March 1, 2027.
In European equities on Wednesday, the CAC 40 in Paris was up 0.9%, while the DAX 40 in Frankfurt was up 1.4%.
The pound was quoted higher at $1.3277 early on Wednesday in London, compared to $1.3229 at the equities close on Tuesday. The euro stood at $1.1384, higher against $1.1303. Against the yen, the dollar was trading lower at JP¥142.21 compared to JP¥143.01.
In Asia on Wednesday, the Nikkei 225 index in Tokyo was down 1.0%. In China, the Shanghai Composite was up 0.3%, while the Hang Seng index in Hong Kong was down 1.6%. The S&P/ASX 200 in Sydney closed down 2.8 points.
In the US on Tuesday, Wall Street ended lower, with the Dow Jones Industrial Average down 0.4%, the S&P 500 down 0.2% and the Nasdaq Composite down 8.32 points.
‘The trade escalation between the US and China continues at full speed, and is spreading into other measures,’ commented Swissquote’s Ipek Ozkardeskaya. ‘In this context, the US just requested Nvidia to stop selling its chips designed for China to the Chinese, and in response the China could well restrict its exports of rare earth metals and other commodities essential to building chips and machines to the US...Note that the latest GDP data released in China this morning topped analyst estimates showing that the country grew 5.4% YoY in Q1, retail sales jumped nearly 6% compared to 4.2% expected by analysts and the new home prices dropped the least in 9 months.
‘The stronger the Chinese data, the less likely it is to bend to US demands.’
Brent oil was quoted flat at $64.37 a barrel early in London on Wednesday from $64.39 late Tuesday.
Gold was quoted higher at $3,296.17 an ounce against $3,223.88.
‘Unsurprisingly, the escalating trade tensions continue to boost appetite in gold,’ Ozkardeskaya noted. ‘The price...just hit a fresh record this morning at $3283 per ounce.’
Still to come on Wednesday’s economic calendar is eurozone CPI, Canada’s interest rate decision and US retail sales and industrial production.
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