FTSE 100 Live Wednesday
- Inflation shows surprise drop
- Bunzl cuts guidance
- WH Smith travel profit surges
Market update: Bunzl slides in weaker FTSE 100, Mitie at 8-year high
10:15 , Graeme EvansThe defensive status of Bunzl shares was today tarnished by a 23% slide as selling returned to the FTSE 100 index and other leading benchmarks.
Bunzl, which provides essential not-for-sale products and services, shocked the City by cutting 2025 guidance due to tougher conditions in North America.
It expects an operating margin moderately below 8%, compared to 8.3% in 2024.
Chief executive Frank van Zanten said: "I am disappointed with our performance in the first quarter in this challenging trading environment.”
Bunzl shares held their own during the recent sell-off but today slumped 712p to a four-year low of 2366p as City analysts cut forecasts by about 10% and reacted to a pause in the company’s buyback programme.
AJ Bell investment director Russ Mould said: “Bunzl is supposed to be a reliable stock – providing everyday essentials like disposable coffee cups to cafes and food wrap to supermarkets.
“It’s not supposed to pull the rug from under investors’ feet by delivering a major profit warning and abandoning a current share buyback.
“This helps explain the ferocity of the market reaction as the company’s reputation as a steady performer takes a real battering.”
The FTSE 100 index traded in the red for the first time this week, but a fall of 38.88 points to 8210.24 represented an improvement from earlier in the session.
Asia stocks set a negative tone, with the Hang Seng index down 1.5%, after President Trump imposed restrictions on Nvidia chip sales to China.
The trade war jitters were offset by a dip in the UK’s annual rate of inflation to 2.6%, which supported market hopes for three interest rate cuts over the rest of 2025.
The outlook benefited rate-sensitive stocks in the FTSE 100 index as Land Securities lifted 3.5p to 556p and Severn Trent improved 42p to 2741p.
Barratt Redrow also advanced 5.5p to 433.2p after its third quarter update reiterated full-year expectations, including for home completions of between 16,800 and 17,200 in the current financial year.
Chief executive David Thomas said: “The fundamentals for our industry remain strong, with a clear need for new homes across all tenures and a national focus on accelerating delivery.”
The biggest riser in the FTSE 100 was Africa-based gold producer Endeavour Mining, which jumped 6% or 118p to 2170p as the price of the precious metal hit yet another record at $3300 an ounce.
Hochschild Mining also jumped 4% or 13.4p to 317p in the FTSE 250 index but the mid-cap benchmark fell 0.5% or 89.33 points to 19,178.61.
Other risers included the outsourcer Mitie, which jumped 6% or 7.2p to an eight-year high of 129.2p after a stronger-than-expected finish to its financial year.
Boosted by good sales momentum and a record pipeline of opportunities, the company also launched a £125 million buyback programme.
At the bottom end of the FTSE 250, WH Smith fell 3% or 30.5p to a four-year low of 920p after in-line interim results were offset by ongoing North American uncertainty and a cautious net store roll-out target.
Inflation surprise boosts rate cut hopes
08:55 , Graeme EvansThe 2.6% inflation print for March is likely to be the lowest for some time, given the much larger contribution of energy and water bills to April’s annual rate.
Deutsche Bank anticipates a figure above 3.25% but also thinks the eventual peak in CPI will be closer to 3.5% rather than the 3.75% it previously thought.
It said: “For now, the Bank of England can continue its gradual dial down of restrictive policy, on the back of weaker labour market data yesterday and today’s softer inflation data.
“In fact, we think the chances of a dovish pivot have increased heading into the May forecast round.”
Peel Hunt said today’s figures firmed up money market expectations for three quarter point interest cuts this year, to 3.75% by the year end.
It adds that policymakers have space to signal that they are prepared to go a bit faster with further cuts, if necessary, in case the weakening global backdrop weighs materially on domestic demand and price setting.
The bank added: “Even if near-term increases in consumer energy prices and final prices linked to higher national insurance lift the price level and annual rates of inflation over the coming months, the effect will likely prove temporary since the balance of medium-term fundamentals is decidedly disinflationary.”
WH Smith travel profits surge, shares fall
08:29 , Graeme EvansWH Smith has reported rising profits across its shops at airports and railway stations as it prepares to sell its high street estate and focus purely on travel outlets.
Profit across its travel shops rose by 17% to £63 million in the six months to February, compared with the previous year.
Meanwhile, profit at its high street business slumped by a quarter to just £20 million, it said in a trading statement weeks after revealing it is selling the division.
Chief executive Carl Cowling said the group is “well-positioned for the peak summer trading period”.
WH Smith shares fell 6.7p to 943.8p, leaving its valuation at the same level as the early stages of the pandemic.
Bearish fund managers issue recession warning
08:23 , Graeme EvansThe world’s most powerful fund managers increasingly fear a recession will be triggered by Donald Trump’s new era of trade barriers.
Bank of America’s monthly Global Fund Manager Survey for April shows a net 42% of respondents now expect a recession.
Overall it was the fifth most bearish survey in the past 25 years, with a record number of global investors planning to cut their exposure to US stocks.
A net 82% of respondents say the global economy is set to weaken, a 30-year high.
There was some good news for Britain with fund managers taking a more favourable view of UK equities compared with the long-term average.
FTSE 100 lower, Bunzl shares slide 23% after downgrade
08:19Bunzl shares have slid 23% or 714p to 2364p, their lowest level in almost four years after the workplace supplier cut guidance due to weaker North American trading.
The reverse came in a session when the FTSE 100 index fell by 0.2% or 15.45 points to 8233.67.
Among other companies reporting today, Barratt Redrow rose 5.15p to 432.85p after reiterating a target for home completions of between 16,800 and 17,200 in the current financial year.
Chief executive David Thomas said: “The fundamentals for our industry remain strong, with a clear need for new homes across all tenures and a national focus on accelerating delivery.”
Utility stocks also featured on the risers board as National Grid lifted 12p to 1066.5p and Severn Trent rose 27p to 2726p.
Bunzl cuts guidance amid North America downturn
07:29 , Graeme EvansFTSE 100-listed Bunzl today cut 2025 guidance in the face of much tougher conditions for its operations in North America.
The company, which supports customers with essential not-for-sale products and services across a range of sectors, said group underlying revenues declined by 0.9% in the first quarter.
Bunzl now expects its operating margin for the year to be moderately below 8%, compared to 8.3% in 2024.
Chief executive Frank van Zanten said: "I am disappointed with our performance in the first quarter in this challenging trading environment.
“We are taking decisive action to improve performance in the group, particularly with regards to execution in our largest business in North America.”
Inflation rate dips more than expected
07:06 , Graeme EvansThe UK’s headline rate of inflation has fallen by more than expected to 2.6%, figures from the Office for National Statistics (ONS) showed today.
The figure for March compares with the previous month’s 2.8% and the 2.7% forecast in the City.
The ONS said the largest downward contributions to the monthly change came from recreation and culture and motor fuels.
Tax rises mean economists are braced for the figure to head back towards 4% later in the year.
FTSE 100 set to fall back, Asia stocks lower
06:59 , Graeme EvansThe FTSE 100 index is set to give up some of this week’s gains after Asia shares struggled on the back of China GDP figures.
The release showed forecast-beating growth of 5.4% in the first quarter, offset by a warning over the impact of US trade tensions on the outlook.
The Hang Seng index fell by 2.5% and the Shanghai Composite by 0.6% in the wake of the figures.
Wall Street also retreated last night, with the Dow Jones Industrial Average down 0.4% and the S&P 500 index off 0.2%.
IG Index futures show the FTSE 100 index is set for a decline of about 0.8% or 69 points, having rallied 1.4% to reach 8249.12 by Tuesday’s close.
