The FTSE 100 closed the week at 10,868.05, up 1.23% from the prior Friday, while the FTSE 250 gained 0.73%. However, the blue-chip index's weekly advance was heavily front-loaded: 126.66 of the 131.82 net points were added on Tuesday and Wednesday, accounting for roughly 96% of the total movement.
The concentrated rally suggests selective buying in large-cap stocks rather than a broad market re-rating. The FTSE 250's modest rise, its third consecutive weekly gain, did little to confirm widespread domestic strength. Analysts noted that the 0.50 percentage point gap between the two indices points to investor preference for established multinationals over smaller UK-focused companies.
On Wednesday, the FTSE 100 was up 1.60% from the previous Friday, but losses on Thursday and Friday trimmed 0.37% off those gains. Friday saw the index set a fresh intraday record of 10,989.45 before closing 121.40 points below that peak. Energy stocks rose 1.9% on the day as Brent crude held above $90 per barrel.
Company Highlights
Several blue-chip companies delivered notable moves. Unilever (LON:ULVR) jumped 8.58% on Tuesday, its best single-day performance in four years, after reporting a 5.8% rise in underlying second-quarter sales, driven by a 5.5% increase in volumes. The consumer giant raised its 2026 underlying sales growth outlook to 4%-6%.
Rolls-Royce Holdings (LON:RR) climbed 6% on Thursday after lifting its annual forecast. The engineering firm now expects underlying operating profit between £4.7 billion and £4.9 billion, following a 46% jump in first-half underlying profit to a margin of 22.5%.
NatWest Group (LON:NWG) rose 3.22% on Friday after posting first-half operating profit before tax of £4.3 billion, ahead of forecasts. CEO Paul Thwaite said the results gave the bank “confidence to strengthen our guidance for 2026,” and the company declared an interim dividend of 12.0 pence per share.
In contrast, Rentokil Initial (LON:RTO) tumbled 20.6% on Thursday after warning of weakness in its North American business. The sharp divergence underscores investors' clear differentiation between companies raising guidance and those missing expectations.
Bank of England and Inflation
The Bank of England voted 6-3 to keep its Bank Rate unchanged at 3.75%, with three members favoring a hike to 4%. June consumer price inflation came in at 2.6%, and policymakers expect inflation to rise again later this year. Rob Wood, an economist at Pantheon Macroeconomics, highlighted the central bank's sensitivity to oil prices: “The rate outlook depends very heavily on the oil shock.”
Looking Ahead
Next week brings a wave of earnings that will test key sectors. BP (LON:BP) and HSBC Holdings (LON:HSBA) report half-year results on Tuesday, followed by Glencore (LON:GLEN) and Next (LON:NXT) on Wednesday, and Diageo (LON:DGE) on Thursday. These results will provide direct evidence on energy profitability, banking margins, mining cash flows, and UK consumer spending trends.
Investors will also monitor the trajectory of oil prices and their impact on inflation and monetary policy. An extended energy shock could push inflation higher and keep policy restrictive, while a stronger sterling might reduce the value of overseas earnings for FTSE-listed companies.
