8.15am: Defence stocks lead FTSE higher at open

The FTSE 100 has indeed started trading at above 9,300 in early deals, climbing just over 12 points to reach the milestone again. 

Defence and aerospace sector shares are leading the front line in initial deals, with BAE Systems up 1.4%, Rolls-Royce rising 1.3% and Melrose Industries just over 1%. 

As often on Thursday, the index is being held back by some stocks going ex-dividend, with the biggest fallers Legal & General, Schroders and Entain all in this group.

Imperial Brands, Mondi, InterContinental Hotels, Anglo American, Convatec and Babcock also ex-dividend, with a combined hit to the FTSE 100 of 4.36 points. 

7.54am: UK public borrowing mixed figures 

UK public finances are slightly better news for the Chancellor, as borrowing comes in lower in July than expected at £1.1 billion, though this was largely offset by June borrowing revised higher.

Public sector net borrowing excluding public sector banks was down from July last year’s figure of £3.4 billion and better than the consensus expectation of £2 billion.

Borrowing in June was revised up to £22.6 billion from £20.7 billion previously, and borrowing in the fiscal year to June was revised to £58.9 billion from £57.8 billion previously.

“Borrowing this July was £2.3 billion down on the same month last year, and was the lowest July figure for three years,” says ONS deputy director for public sector financesm, Rob Doody.

“This reflects strong increases in tax and National Insurance receipts.

“However, in the first four months of the financial year as a whole, borrowing was over £6 billion higher than in the same period in 2024.”

7.43am: WH Smith profit warning

WH Smith has warned that profits for its current financial year will be £30 million lower than current market expectations due to over-inflating North American profit by booking supplier rebates early. 

The FTSE 250 group said it has asked accountants Deloitte to carry out a “comprehensive review” after the amount of headline trading profit was overstated due to “accelerated recognition of supplier income”.

These supplier incentives and discounts, which should have been accrued over time as a reduction in cost of sales, were booked too early, inflating divisional performance. The board has commissioned an investigation by Deloitte.   

7.24am: Bond boost for London stocks

UK stocks were helped by the bond market yesterday, says Peter Sidorov in Deutsche Bank’s morning macro strategy note.  

Gilts yields saw a larger rally than those in the US and elsewhere, with 10yr yields down almost seven basis points despite July inflation coming in slightly stronger than expected at both headline and core rates.

“A saving grace noted by our UK economist Sanjay Raja is that with the volatile transport and travel services components driving the upside, most core services metrics ticked down on the month,” says Sidorov.

He notes that money markets moved to price in more Bank of England easing for early 2026 following the release, with the amount of cuts priced by next June rising 5.5bps to 38bps.

“The repricing in UK rates helped the FTSE 100 outperform,” he says, with the London index up over 1%, while the Euro Stoxx 600 rose 0.24% and continental indices were more subdued, with the CAC flat and the DAX down 0.69% and FTSE MIB losing 0.36%.

Elsewhere, Sidorov flags the main US stories as the further Mag 7 tech sell-off and continued concerns over the independence of the US Federal Reserve, after President Trump suggested that Fed Governor Cook should resign over allegations of mortgage fraud.

“The news was a reminder of the lingering concerns over future Fed independence and risks of fiscal dominance, though the extent of the market reaction was fairly modest. The most sustained reaction was in gold (+0.98%)”. 

7.15am: FTSE 100 to start exploring above 9,300

The FTSE 100 could start the morning exploring the virgin territory above the 9,300-point mark, after making base camp at just under that mark last night.  

London’s blue-chip index is being called eight points higher on the futures market, having finished 98 points to the good yesterday at a record closing high of 9,288.1 and having banged its flag at 9,301 in an all-time intraday high earlier in the session. 

All but two (Rolls-Royce and BP) of the index’s top 20 largest companies finished in the green, many with gains of over 2% or 3%, including bond proxies and solid dividend payers such as United Utilities, Unilever, Coca-Cola Europacific, Imperial Brands and BAT. 

Across the Atlantic, Wall Street’s main indices mostly extended their losses, led by the 0.67% retreat for the Nasdaq, though this was less than half its deficit during the rout earlier in the session. 

The S&P 500 fell 0.24% and Dow Jones was 16 points above the flatline.

 Asian markets are mixed again, with Japan still on the down slope.