FX.co ★ FTSE 100 Trades Cautiously After Inflation

The FTSE 100 hovered around the flatline on Wednesday, as strength in commodity-linked stocks was offset by weakness in the banking sector. Lender shares came under pressure after investors slightly pared back expectations for a Bank of England rate hike later this year.

UK inflation accelerated to 2.9% year-on-year in July from 2.6% in June, matching market forecasts. However, traders largely viewed the uptick as anticipated, attributing it mainly to higher energy costs. As a result, market participants modestly scaled back their rate-hike bets rather than materially revising their outlook.

Among individual movers, Smith & Nephew was one of the biggest decliners, falling as much as 3.7% after CFO John Rogers announced his resignation to take up a role in the US.

By contrast, energy and mining stocks lent support to the index. BP gained about 1%, while Shell rose 0.6%. Anglo American and Rio Tinto each advanced roughly 0.7%, and Glencore added 0.5%.