London close: FTSE rises as housebuilders rally, oil eases

(Sharecast News) - London stocks rose on Wednesday, underpinned by strength in the housebuilding sector after well-received results from Barratt Redrow, as investors digested UK inflation figures and looked ahead to an expected rate hike by the Federal Reserve.

The FTSE 100 closed up 0.3% at 10,688.47, while Brent crude was 2.8% lower at $105.76 a barrel and West Texas Intermediate was down 3.2% at $102.42

Russ Mould, investment director at AJ Bell, said the drop in the oil price provided "some much-needed relief to the market following an intense period that fired up inflation worries".

"The dip in the commodity price might not be enough to steer the Federal Reserve on a different path though. It is widely expected to raise interest rates today, with the first of potentially two or three hikes over the next six months," he added.

On home shores, figures from the Office for National Statistics showed that inflation rose in line with expectations in August amid higher fuel prices. The consumer prices index ticked up to 3.1% year-on-year last month from 2.9% in July.

The ONS said transport, particularly motor fuels, made the largest upward contribution to the change in CPI. Fuel prices rose 23% in the 12 months to August, compared with a 15.5% increase the previous month.

On a monthly basis, CPI rose 0.5% in August, up from 0.3% in August 2025.

ONS chief economist Grant Fitzner said: "Sharp rises for petrol and diesel pushed inflation up again in August.

"Higher airfares, particularly for long-haul journeys, also contributed to the increase.

"Rising crude oil and petrol prices increased both the annual cost of raw materials and the price of goods leaving factories respectively."

The latest inflation reading came ahead of a policy announcement on Thursday from the Bank of England, which is widely expected to hold rates steady at 3.75%. Adam Deasy, economist at PwC UK, said the BoE has a difficult task, balancing a worsening external price shock against a domestic economy sending mixed signals.

"Oil prices are now above $100 a barrel, similar to the most adverse of the three scenarios the Bank of England set out in July; gas prices are currently exceeding that scenario's assumptions," he said. "But while inflationary pressures build, the UK's labour market continues to weaken, suggesting some areas of growing fragility in the economy. At the same time, July GDP has surprised to the upside.

"That leaves the Bank in wait-and-see mode, but with less room for comfort. Monetary policy won't shift the energy markets, nor the machinations of global geopolitics, but it may prevent inflation becoming embedded in wages and prices. That's what the Bank will be watching for and where it's probably too soon to say."

In equity markets, Barratt Redrow shot to the top of the FTSE 100 as it trimmed its guidance for FY27 home completions but reported a 5% jump in FY26 completions to 17,667 - towards the top of its guidance range - and said it had entered FY27 with a solid forward sales position.

Barratt posted full-year adjusted pre-tax profit of £572.8m, down 7.1% on the previous year but ahead of forecasts of £560m.

Peer Persimmon also gained, along with Bellway and Taylor Wimpey.

Defence firm Babcock advanced as it said trading for the first five months of the fiscal year was in line with expectations, with strong Nuclear and Aviation performance and its fullyear outlook unchanged.

Pan African Resources was up as the gold miner unveiled a record dividend and share buyback following a doubling of both revenues and profits, and forecast further production growth in the current financial year.

Kier surged as Deutsche Bank hiked its price target on the stock to 330p from 295p.

On the downside, BP and Shell gushed lower in tandem with oil prices.

Online greeting cards and gifts retailer Moonpig slumped as it backed its outlook for FY27 and said trading had been in line with its expectations since the start of the year. AJ Bell's Mould said: "Moonpig shares couldn't fly after its latest trading update failed to deliver any upgrades and highlighted the continuing drag on performance from the Experiences division.

"The share price pullback follows a strong showing for the stock in recent months after June's full-year results impressed, with the company's bumper cash flow allowing for generous share buybacks."

Market Movers

FTSE 100 (UKX) 10,688.47 0.28%

FTSE 250 (MCX) 24,070.20 1.06%

techMARK (TASX) 6,102.11 1.30%

FTSE 100 - Risers

Barratt Redrow (BTRW) 308.80p 11.72%

Persimmon (PSN) 1,162.00p 5.78%

International Consolidated Airlines Group SA (CDI) (IAG) 418.20p 2.83%

Babcock International Group (BAB) 1,021.50p 2.81%

Antofagasta (ANTO) 3,594.00p 2.66%

3i Group (III) 2,668.00p 2.65%

SSE (SSE) 2,401.00p 2.56%

Centrica (CNA) 152.40p 2.52%

Lloyds Banking Group (LLOY) 111.25p 2.39%

NATWEST GROUP (NWG) 702.20p 2.39%

FTSE 100 - Fallers

St James's Place (STJ) 1,085.00p -2.52%

BP (BP.) 566.80p -2.33%

Shell (SHEL) 3,576.50p -2.08%

Metlen Energy & Metals (MTLN) 45.74p -2.06%

Convatec Group (CTEC) 216.20p -1.55%

Compass Group 11 (CPG) 30.91p -1.53%

Next (NXT) 14,560.00p -1.52%

Imperial Brands (IMB) 2,490.00p -1.46%

London Stock Exchange Group (LSEG) 8,150.00p -1.45%

Abrdn (ABDN) 239.20p -1.32%

FTSE 250 - Risers

Kier Group (KIE) 287.20p 11.49%

Bellway (BWY) 2,092.00p 7.06%

Taylor Wimpey (TW.) 80.78p 5.87%

GB Group (GBG) 159.20p 5.57%

Pan African Resources (PAF) 120.90p 5.50%

Playtech (PTEC) 441.20p 5.45%

Balfour Beatty (BBY) 892.00p 5.25%

Vistry Group (VTY) 281.40p 5.16%

Ceres Power Holdings (CWR) 376.40p 4.79%

XP Power Ltd. (DI) (XPP) 1,848.00p 4.64%

FTSE 250 - Fallers

Diversified Energy Company (DI) (DEC) 1,062.00p -4.67%

Ithaca Energy (ITH) 283.20p -2.88%

Baltic Classifieds Group (BCG) 2.29p -2.64%

Frasers Group (FRAS) 763.00p -2.62%

Harbour Energy (HBR) 273.20p -2.57%

Oxford Biomedica (OXB) 449.50p -2.49%

Michael Page (PAGE) 205.60p -2.37%

Aston Martin Lagonda Global Holdings (AML) 32.76p -2.21%

Syncona Limited NPV (SYNC) 111.60p -1.76%

Hays (HAS) 64.60p -1.75%