The FTSE 100 in the UK achieved a new record close on Wednesday, driven by gains in consumer stocks, as investors evaluated an inflation report that dampened expectations for an immediate Bank of England rate cut.
The FTSE 100 blue-chip index rose by 1%, surpassing the record levels reached on Friday.
In contrast, the more domestically oriented FTSE midcap index showed a smaller increase of 0.2%.
Both benchmark indexes recovered from earlier session losses.
Official statistics showed the UK’s consumer price inflation reached an 18-month peak in July, climbing to 3.8%, marking the fastest annual growth among the Group of Seven economies, nearing the Bank of England’s 4% peak projection for September.
This data further reduced the already minimal chances of a rate cut by the British central bank, with traders now expecting a quarter-point reduction in March next year. Earlier, the market had forecasted a cut before the end of 2025.
Concerns over mortgage affordability due to the inflation report’s impact on interest rates caused a 0.2% drop in homebuilders.
The aerospace and defense index faced pressure for the second day in a row, declining by 1.7% after experiencing its largest single-day drop since early April on Tuesday.
Consumer stocks led the FTSE 100 gains, with Unilever, Reckitt, and Tesco rising between 1.2% and 3.2%. The healthcare sector gained 1.8%.
Financial stocks contributed to the upward trend, with banks and non-life insurers increasing by 1.4% and 1.7%, respectively.
Utilities experienced a 1.9% boost, as water provider United Utilities climbed 3.5% following Barclays’ upgrade of its stock rating from “Equal Weight” to “Overweight.”
Among notable movers, Ithaca Energy surged 10.4%, reaching its highest level in nearly three years after raising its 2025 production forecast.
Medical equipment manufacturer Convatec rose 5.6%, marking its best day since March this year, following the announcement of a $300 million share buyback program.
