FTSE 100 today: Index gains, pound lower, house prices drop in June

Published 01/07/2025, 08:30
Updated 01/07/2025, 17:04
© Reuters.

Investing.com -- The FTSE 100 index made slight gains on Tuesday after opening higher, while the pound edged lower, still above $1.37. Meanwhile, major economic data showed that U.K. house prices fell in June.

The blue-chip index FTSE 100 rose 0.3% and the British pound is down 0.1% against the dollar, still above 1.37. 

DAX index in Germany fell about 0.8%, the CAC 40 in France was flat.  

Ofgem approves U.K. energy infrastructure investment plan

Britain’s energy regulator Ofgem has provisionally approved a £24 billion investment program to enhance the country’s energy infrastructure and boost renewable energy capacity.

The five-year plan allocates over £15 billion to ensure the safe operation of Great Britain’s gas transmission and distribution networks, while £8.9 billion is designated for the high-voltage electricity network, with an additional £1.3 billion ready for deployment.

Southern Water secures equity boost for infrastructure upgrades

In separate news, Southern Water has secured a £655 million legally binding equity commitment from its majority shareholder, as part of a broader equity investment package totaling up to £1.2 billion. 

The funding, provided through a consortium led by funds managed by Macquarie Asset Management, will be invested directly into Southern Water’s operating company to fund planned infrastructure improvements over the next 5 years.

U.K. factory activity edges up in June

Britain’s manufacturing sector showed improvement in June, marking the third consecutive month of progress despite remaining in contraction territory.

The S&P Global/CIPS manufacturing Purchasing Managers’ Index (PMI) rose to 47.7 in June from 46.4 in May.

Wood Group extends debt covenant waivers 

In corporate news, John Wood Group PLC (LON:WG) said it has extended its temporary waivers until July 31, 2025.

The company said the waivers have been expanded to include financial covenants for the period ending June 30, 2025.

BoE’s Bailey flags labour market softening, eyes inflation implications

Bank of England Governor Andrew Bailey stated Tuesday that Britain’s labor market is showing signs of softening, which raises questions about how this trend will affect inflation returning to target.

"I do see some underlying weakening, particularly in the labour market - and the labour market is softening," Bailey said during an interview with CNBC at a central bank summit in Sintra, Portugal.

Sainsbury ’s (LON:SBRY) reports 4.9% sales rise in first quarter

J Sainsbury plc (OTC:JSAIY) reported a 4.9% increase in retail sales excluding fuel for the first quarter of 2025/26. 

For the 16 weeks ending June 21, like-for-like sales excluding fuel grew 4.7%. The company saw grocery sales rise by 5%, while general merchandise and clothing sales increased by 4.2%. Argos, owned by Sainsbury’s, recorded a 4.4% sales growth.

Sainsbury’s maintained its full-year guidance, expecting to achieve approximately £1 billion in underlying retail operating profit and more than £500 million in retail free cash flow. The company noted that profit delivery would be weighted more toward the second half of the year.

British house prices fall in June

In other U.K. economic news, British house prices fell by 0.8% in June, the largest monthly decline in over two years according to mortgage lender Nationwide.

This drop exceeded economists’ expectations of a 0.2% monthly increase and coincided with the end of a property transaction discount in Britain.

U.K. shop prices rise in June

Meanwhile, U.K. shop prices rose for the first time in almost a year, with the British Retail Consortium reporting year-on-year inflation in stores at 0.4% in June, compared to -0.1% in May.

This increase was primarily driven by a 3.7% rise in food prices, the highest annual increase since March 2024.

Regulator approves Aviva (LON:AV)’s deal for Direct Line (LON:DLGD)

In corporate developments, competition regulators have approved Aviva’s £3.7 billion acquisition of Direct Line, which will create Britain’s largest motor insurer.

The Competition and Markets Authority announced it would not refer the deal for further investigation.

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