UK Market Breakdown: Oil and CPI Pin the FTSE 100, Week of 17 August 2026

London's blue chips went almost nowhere in the first three sessions of the week, but the flat headline hid a lot of movement underneath. The FTSE 100 closed on Wednesday at 10,743.35, up 15.31 points on the day and just 6.76 points — 0.06% — below the 10,750.11 it finished at on Friday 14 August. Getting there took a sixth consecutive daily fall on Monday, a narrow rebound on Tuesday that snapped the losing run, and a second small gain on Wednesday.

Two forces did most of the work. Brent crude climbed for a fourth straight session towards $92 a barrel after the 60-day US-Iran ceasefire lapsed without an agreement, lifting BP and Shell and repeatedly rescuing the index from a worse day. Pulling the other way, UK inflation rose to 2.9% in July, its highest reading since March, which weighed on bank shares on Wednesday as traders trimmed bets on a Bank of England rate rise later this year.

The mid caps had the harder time. The FTSE 250 fell about 0.9% over the same three sessions, from Friday's 24,867.42 to 24,643.52, having set an all-time intraday high of 24,966.77 as recently as 12 August.

The FTSE 100

Monday set the tone. The index shed 29.81 points, or 0.28%, to 10,720.30 — a sixth straight decline — with the damage concentrated in the consumer names rather than anywhere obviously cyclical. Tesco fell 3.0% and Sainsbury's 3.2% ahead of Tuesday's Worldpanel grocery data, and JD Sports dropped 3.2% ahead of its Thursday trading statement. Miners provided the offset: Endeavour Mining rose 84.0p to 4,195.0p, Anglo American added 78.0p to 3,928.0p, Fresnillo gained 50.0p to 2,930.0p and GSK put on 34.0p to 1,851.5p, with gold quoted at $4,423.12 an ounce, up from $4,388.17 on Friday.

Tuesday reversed the pattern almost exactly. Oil did the lifting — Shell and BP were up 1.3% and 1.8% in morning trade as Brent pushed above $91 — while the precious metals names gave back Monday's gains, Endeavour Mining, Fresnillo and Antofagasta each falling around 2% as gold and copper slipped. RELX, BP and Burberry led the blue-chip risers on the day; Fresnillo was among the heaviest fallers. The index closed at 10,728.04, up 7.74 points, ending the six-session losing streak.

Wednesday brought the week's main data event and a familiar split. Commodity stocks again supported the market, with BP up around 1%, Shell 0.6%, Anglo American and Rio Tinto roughly 0.7% each and Glencore 0.5%. Banks went the other way after the inflation figures firmed up expectations that the Bank of England will sit on its hands next month. The net result was another small gain, 15.31 points, to 10,743.35.

The FTSE 250 and mid caps

The mid-cap index took the brunt of the domestic gloom. Monday's 0.7% fall to 24,704.40 was its biggest one-day drop in more than three weeks, driven in large part by housebuilders after Rightmove reported that average asking prices fell 2.0% in the month to August, from £372,359 to £364,999. That is the largest August fall since 2018, against a ten-year average of 1.3%, and leaves asking prices 1.0% lower than a year earlier — the steepest annual drop since December 2023. Persimmon and Taylor Wimpey each eased 1.7% and Barratt Redrow fell 1.0%.

Rightmove, which is itself a FTSE 100 constituent, also cut its forecast for the year, from a 2% rise in new seller asking prices to a range of zero to minus 2%, and noted that the number of homes for sale is at a 12-year high. London was the weakest region, with asking prices down 4.4% on the month and 3.1% on the year.

Tuesday took the index down a further 0.6% to 24,561.43 before Wednesday's 0.3% recovery to 24,643.52. Beneath the index, though, the week produced two of London's punchiest individual moves — one in the FTSE 250 and one on AIM — both from technology companies raising guidance rather than anything macro.

The week's biggest movers

Kainos was the standout. The Belfast-headquartered IT services group told the market on Tuesday that full-year results would be "comfortably ahead" of expectations, guiding to adjusted pre-tax profit of £75.0m to £84.0m on revenue of £498.0m to £514.0m, against £67.1m and £431.1m in the year just ended. It pointed to accelerating demand in its Workday consulting arm and a record contracted backlog across all three divisions. The shares jumped as much as 21.9% to 1,185.50p, from Monday's close of 972.5p.

Made Tech, the AIM-quoted public sector software specialist, rose around 13% to 43.45p on the same day after announcing the largest contract award in its history — a four-year deal with a UK government department worth roughly £40m. That takes contracted backlog to about £115m and prompted the company's second guidance upgrade of 2026, to revenue of £63m to £66m and adjusted EBITDA of £6.3m to £6.6m, against prior market expectations of £60.3m and £6.0m.

Ithaca Energy was Wednesday's big riser, climbing as much as 7.8% to 270.2p from Tuesday's 251.6p close. The North Sea producer reported record quarterly output of 131 thousand barrels of oil equivalent a day, taking the first-half average to 128 kboe/d from 124 a year earlier, and lifted full-year dividend guidance to $500m-$530m from $470m-$520m. It also declared a first interim dividend of $255m and trimmed net operating cost guidance to $800m-$840m.

Smith & Nephew was the week's most conspicuous blue-chip faller, dropping 3.38% on Wednesday after saying chief financial officer John Rogers will step down at the end of September to take an external role in the United States, ending a tenure of around two and a half years. Pierre Palassian, senior vice president finance and group controller, becomes interim CFO while the board searches for a permanent replacement.

Tesco and Sainsbury's were the softest of the large caps on Monday, down 3.0% and 3.2%, in what looked like positioning ahead of the grocery share data rather than a reaction to anything company-specific. IG Group fell 2.7% on Wednesday after UBS lowered its price target on the spread-betting and trading platform.

Company news in focus

The week's most significant corporate announcement came from AstraZeneca on Monday, and it was not a good one. The company discontinued the eVOLVE-Lung02 Phase III trial of volrustomig plus chemotherapy as a first-line treatment for metastatic non-small cell lung cancer, acting on the recommendation of the Independent Data Monitoring Committee, which concluded the combination was unlikely to meet either of the dual primary endpoints of progression-free survival or overall survival in patients with PD-L1 negative tumours. AstraZeneca reported no unexpected safety issues and said other Phase III volrustomig trials, in cervical cancer, head and neck squamous cell carcinoma and mesothelioma, continue as planned.

Smith & Nephew's boardroom change lands in an awkward spot: the group had already cut its 2026 organic sales growth guidance to about 4% from about 6% when it reported first-half results, so a search for a new finance chief begins with the company already resetting expectations.

In takeover land, easyJet shares closed Tuesday at 670.10p, still a visible distance below the 715p a share in cash that Apollo agreed to pay for the airline on 6 August in a deal valuing it at roughly £5.7bn. The deal carries a long timetable and several conditions: Apollo's stake is to be capped at 49.9% to satisfy UK and EU airline ownership rules, and completion is not expected until the end of March 2027. Founder Sir Stelios Haji-Ioannou and his family, who hold 15.3%, back the deal.

Earnings and trading updates

This was a thin week for scheduled results in London — the diary sits in the gap between the July reporting rush and the September restart — which is part of why the two guidance upgrades carried so much weight.

The most widely watched numbers were not company results at all but the Worldpanel by Numerator grocery data published on Tuesday. Like-for-like grocery price inflation eased to 2.1% in the four weeks to 9 August, the lowest since October 2024 and down from 2.6% in the previous report and 3.0% the one before that. Over the 12 weeks to 9 August, Tesco sales rose 1.8% year on year but its market share slipped for a third consecutive report, while Sainsbury's grew sales 3.5%.

Ithaca Energy's second-quarter production report and Kainos's trading update, covered above, were the two sets of company numbers that genuinely moved prices. Made Tech's contract announcement functioned as a de facto trading update, given it came with upgraded revenue and EBITDA guidance attached.

Macro and the Bank of England

Tuesday's labour market release showed further cooling. The unemployment rate stood at 4.9%, up from 4.7%, with 1.77 million people out of work, an increase of 88,000 over the year. The early estimate of payrolled employees for July was down 94,000 on the year at 30.3 million, and vacancies fell to 707,000 in the May-to-July period, below pre-pandemic levels. Regular pay grew 3.5% and total pay 4.1%, both still ahead of inflation.

Wednesday's consumer price index then went the other way. CPI rose 2.9% in the year to July, up from a 15-month low of 2.6% in June and in line with forecasts, with the largest upward contribution coming from housing and household services after Ofgem's energy price cap increase; gas prices rose 14.7%, the biggest jump since October 2022. Core CPI came in at 2.6%, slightly above the 2.5% expected, and CPIH rose to 3.1% from 2.8%.

The combination pushed market-implied odds of the Bank holding rates in September to 82%, from about 75% the day before, according to Reuters. Gilts were volatile: the 10-year yield rose back above 5.0%, its highest since 23 July, while the 30-year eased to 5.80% on Wednesday. Sterling firmed against the dollar mid-week, though analysts attributed the move mainly to the US rates market rather than the UK inflation print.

Still to come

Thursday and Friday close out a data-heavy week, with the flash PMIs the main event.

The week commencing 24 August is unusually quiet for UK scheduled data and company results, with the diary not filling up again until the September reporting season. Oil and the Strait of Hormuz have driven most of London's day-to-day moves over the past fortnight, and nothing on the calendar displaces them before then.

This article is for information and education only. It is not financial advice or a recommendation to buy, sell or hold any investment. Always do your own research.