Britain’s FTSE 100 closed Tuesday’s session down 0.06% as the International Monetary Fund raised its UK economic growth projection for 2026 while oil prices slipped.
The IMF’s World Economic Outlook update revised the UK’s 2026 growth estimate upward to 1.3%, compared with the 1% forecast issued back in July.
The outlook for 2027 was trimmed slightly to 1.2% from a prior estimate of 1.3%, reflecting anticipated pressure from higher energy costs and interest rates on both consumption and investment.
British retail sales offered some encouragement, climbing 1% year over year on a like-for-like basis in September, outpacing August’s 0.5% increase and a consensus estimate of 0.8% growth.
Data from the British Retail Consortium underpinned the retail figures, pointing to a consumer base that is increasingly selective in its spending choices.
KPMG’s UK head of consumer, retail and leisure, Linda Ellett, offered this assessment: “September’s retail sales figures point to an increasingly selective consumer.”
Ellett added: “Overall sales increased, driven by food, but non-food sales were essentially flat and have declined slightly across the last three months.”
She described the situation as “a battle for share of wallet, with shoppers prioritising some categories while postponing purchases elsewhere.”
Melrose Industries (MRO.L) was among the top blue-chip performers, surging 3.47% after its GKN Aerospace unit moved closer to settling a civil investigation into its Garden Grove facility in California.
The proposed settlement for GKN Aerospace includes $15 million in civil penalties alongside a previously announced claims program of up to $100 million for eligible recipients.
Whitbread (WTB.L) gained 2.15% after the British hospitality company “strongly” recommended shareholders vote against activist investor Corvex’s resolution at a forthcoming shareholder meeting, while also affirming its full-year outlook and five-year plan.
London Stock Exchange Group (LSEG.L) confirmed it is in talks to acquire credit platform Octus from investment firm Permira for $3.5 billion, with the exchange operator expecting the potential deal to be immediately accretive to group revenue growth.
Despite that strategic announcement, LSEG.L shares fell 4.68%, making it one of the worst performers on the index during the session.
Infrastructure company Balfour Beatty (BBY.L) declined 3.63% after it sold its 50% stake in Gammon Construction to investment company Jardine Matheson Holdings (JAR.L) for 250 million pounds sterling.
Oil prices also weighed on the broader market tone, falling in anticipation of more Russian diesel flowing into global markets and dampening sentiment across energy-linked stocks.
