London open: Stocks fall as investors mull Powell speech; defence names jump

(Sharecast News) - London stocks edged lower in early trade on Wednesday, taking their cue from a negative close on Wall Street after Federal Reserve chair Jerome Powell said in a speech that equities were highly valued. At 0830 BST, the FTSE 100 was down 0.2% at 9,202.54.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: "Wall Street hit pause on its rally yesterday, with the S&P 500 slipping 0.6% and the Nasdaq down 0.9%. The pullback came after three straight record closes, as Fed Chair Powell flagged 'fairly highly valued' equity prices and investors reassessed the sustainability of recent AI-fuelled gains.

"Gold is hovering near record highs as investors weigh mixed signals from the Fed on inflation and jobs. Powell's cautious tone was echoed by divided views across the committee, keeping rate cut expectations alive ahead of August's PCE print, the Fed's preferred measure of inflation. Add in rising geopolitical tensions and strong ETF inflows, and gold's appeal is holding firm despite the policy fog."

In equity markets, defence firms BAE Systems and Babcock were high risers after US President Donald Trump said he believes Kyiv can "win all of Ukraine back in its original form". He made the statement on Truth Social after meeting Ukrainian president Zelensky in New York.

Neil Wilson, UK investor strategist at Saxo Markets, said: "Defence stocks were among the big gainers after Donald Trump agreed Nato countries should shoot down Russian aircraft that violate their airspace, and backed Ukraine to reclaim all its territory lost to Russia - with EU funds of course."

Retailer JD Sports Fashion edged up as it confirmed it was on track to meet full-year profits guidance despite a "tough" trading environment, but struck a cautious note on the outlook for the trading environment. It flagged consumer finances, a weaker jobs market and changes in the footwear product cycle.

Saga surged as it said full-year underlying pre-tax profit was set to be in line with market expectations after a better-than-expected first half, driven by continued strength in the travel segment.

Pinewood Technologies - which was included in the FTSE 250 just last week - slid despite posting a rise in first-half profit and revenue and setting new medium-term guidance.

Online classifieds portals operator Baltic Classifieds tumbled as it warned on full-year profits and revenue, pointing to a depressed Estonian car market.

Market Movers

FTSE 100 (UKX) 9,202.54 -0.23% FTSE 250 (MCX) 21,620.50 -0.35% techMARK (TASX) 5,429.19 -0.06%

FTSE 100 - Risers

BAE Systems (BA.) 1,990.50p 2.02% Fresnillo (FRES) 2,378.00p 1.45% Babcock International Group (BAB) 1,196.00p 1.44% Centrica (CNA) 169.15p 0.92% National Grid (NG.) 1,048.50p 0.91% British American Tobacco (BATS) 3,929.00p 0.82% United Utilities Group (UU.) 1,132.50p 0.80% Rolls-Royce Holdings (RR.) 1,172.00p 0.69% Imperial Brands (IMB) 3,102.00p 0.68% Sainsbury (J) (SBRY) 327.40p 0.68%

FTSE 100 - Fallers

Barclays (BARC) 382.20p -1.82% Burberry Group (BRBY) 1,123.50p -1.71% IMI (IMI) 2,264.00p -1.39% Entain (ENT) 855.60p -1.38% Ashtead Group (AHT) 5,154.00p -1.38% Schroders (SDR) 373.40p -1.27% JD Sports Fashion (JD.) 87.50p -1.24% Flutter Entertainment (DI) (FLTR) 20,870.00p -1.23% Smith & Nephew (SN.) 1,332.50p -1.15% ICG (ICG) 2,242.00p -1.15%

FTSE 250 - Risers

Bakkavor Group (BAKK) 220.00p 3.53% Rank Group (RNK) 143.00p 3.03% Mitchells & Butlers (MAB) 271.50p 2.26% QinetiQ Group (QQ.) 526.00p 1.84% Chemring Group (CHG) 560.00p 1.63% Foresight Solar Fund Limited (FSFL) 76.60p 1.59% Hochschild Mining (HOC) 351.60p 1.50% Partners Group Private Equity Limited. (EUR) (PEY) 10.35p 0.98% Kier Group (KIE) 211.00p 0.96% Drax Group (DRX) 690.50p 0.73%

FTSE 250 - Fallers

Pinewood Technologies Group (PINE) 459.00p -13.23% Baltic Classifieds Group (BCG) 276.50p -12.50% Aston Martin Lagonda Global Holdings (AML) 79.70p -2.09% Carnival (CCL) 2,065.00p -2.04% C&C Group (CDI) (CCR) 141.80p -1.94% Anglo-Eastern Plantations (AEP) 1,315.00p -1.87% RS Group (RS1) 561.00p -1.58% Bridgepoint Group (Reg S) (BPT) 311.00p -1.52% Bodycote (BOY) 632.50p -1.48% Edinburgh Worldwide Inv Trust (EWI) 204.00p -1.45%