FTSE 100 Rises on Strong UK Business Confidence as Investors Await Fed Speech

The UK's FTSE 100 index advanced 0.4% on Friday, recovering from the previous session's losses, but the benchmark remained on course to finish a volatile week largely unchanged. Gains were driven by a positive domestic economic outlook, while traders maintained a cautious stance ahead of a key policy address from the U.S. Federal Reserve.

Markets Await Jackson Hole Guidance

Trading activity remained disciplined as investors hesitated to make significant sector allocations before a scheduled speech by Federal Reserve Chair Kevin Warsh at the Jackson Hole Economic Policy Symposium. The address is being closely watched for signals on the central bank's future monetary policy path, leading to range-bound trading across European markets.

UK Business Confidence Hits Five-Month High

A key fundamental support for UK equities came from a monthly survey by Lloyds Bank, which showed a significant uptick in domestic business sentiment. The report provided a positive contrast to recent economic anxiety in continental Europe.

Ad

• The business confidence reading rose four percentage points in August to +53%, its highest level since March.
• This figure is comfortably above the 12-month average of 47%.
• Lloyds attributed the rise to strengthening consumer spending, brighter trading prospects, and a more optimistic overall economic outlook.

Energy Majors in Focus

Energy giants Shell and BP saw modest gains of around 0.4% despite a broader decline in global oil prices. Brent crude was on track to break a two-week winning streak. In company-specific news, Bloomberg News reported that Shell PLC had ended negotiations to sell its stake in Germany’s PCK Schwedt refinery. Meanwhile, BP PLC urged a union at its Whiting, Indiana refinery to agree to federal mediation to resolve an ongoing labor dispute.