London's FTSE 100 held broadly flat on Wednesday as investors waited on US inflation data, while Balfour Beatty jumped to a record high on an upgraded profit forecast. In Frankfurt, the DAX 40 pushed further into record territory, with traders also watching the Bank of England's rate path and the Federal Reserve's next move.
Balfour Beatty jumps on raised profit forecast
The FTSE 100 edged up 0.04% to 10,848.75 points by 1014 GMT, staying largely on the sidelines as traders waited on the day's US inflation print. Midcap stocks outperformed, with the FTSE 250 climbing 0.5% to 24,916.12 points, on track to close at a record high.
Construction group Balfour Beatty jumped 9.2% to a record high after raising its annual operating profit forecast, citing strong demand for infrastructure projects in the United States and UK. Mining giants Anglo American and Rio Tinto each gained more than 1% as copper prices edged up after a temporary shutdown at a major Indonesian smelter added pressure on the metal's supply.
Markets await US inflation data
Global stocks held steady ahead of the US inflation data, which is expected to show consumer prices increased moderately in July, potentially easing financial market expectations for the Federal Reserve to raise interest rates this year. A surprisingly weaker-than-expected US jobs report last week tempered expectations around rate hikes this year, though simmering concerns about the Middle East war left investors in doubt.
Investors are also waiting for the UK's GDP data on Thursday, which is expected to show economic growth stalled on a month-over-month basis in June following 0.1% growth in May. Britain's new Prime Minister Andy Burnham said his government will do what it can to help lower costs for business, though according to Reuters he acknowledged a "difficult financial outlook". Traders are pricing in a 46% chance of a 25-basis-point rate hike by the Bank of England in December.
DAX 40 pushes toward 27,000
In Frankfurt, the DAX 40 rose above Tuesday's 26,504-point record high, putting the 27,000 region on the cards. Immediate upside pressure should be maintained while the 6 August low at 26,082 underpins, according to IG's technical analysis.
Separately, US annual inflation is expected to ease to 3.4% from 3.5% in the upcoming print, a reading that could shape whether the Fed moves on rates. The German benchmark stays on a bullish footing as long as it holds above that August low.
Sources: Investing.com (Reuters), IG
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