UK Stock Market Today: FTSE 100 Futures Edge Higher As Traders Weigh Sticky CPI

The Morning Bull - UK Market Morning Update Friday, 23 Oct 2026

UK markets look set for a cautiously positive open, with investors focused on a fresh burst of domestic inflation data. The tone is risk aware rather than euphoric as price pressures firm again.

Headline CPI stands at 3.5% year on year for September, the highest in 11 months, while core inflation is at 2.8%. Producer output prices are at 4.6% year on year. Together, these readings suggest sticky underlying costs.

Stubborn inflation keeps attention on borrowing costs. Expectations for interest rates to remain higher for longer tend to raise discount rates on future cash flows, which can pressure equity valuations and complicate funding plans for heavily indebted businesses.

The immediate focus is whether upcoming UK data, especially September retail sales and today’s manufacturing and services PMIs, confirm this inflation resilience. Stronger activity would support the higher rate narrative, while softer numbers could reopen the debate on how restrictive policy already is.

Stocks to Watch Before the Opening Bell

Rathbones Group (RAT)

Rathbones Group reports funds under management and administration of £121.1b, a 7% year-on-year rise, with Wealth Management posting a second straight quarter of net inflows. Asset Management saw outflows as active UK equity products faced pressure, while nine-month operating income is up 6.7%. Watch progress on the £60m regulatory remediation programme through mid 2028.

Rio Tinto Group (RIO)

Rio Tinto has approved a US$1.9b spend on the Kangwinan bauxite project in Queensland, targeting 20 million tonnes of annual capacity to replace output from the Andoom and Gove sites. The move reshapes the miner’s long-term bauxite footprint. Investors will be watching project timing, cost discipline and how today’s Canada low-carbon aluminium funding announcement affects future capital needs.

AstraZeneca (AZN)

AstraZeneca secured accelerated FDA approval for Ultomiris in primary IgA nephropathy after Phase 3 data showed a significant reduction in proteinuria for adults at risk of progression. The green light opens a route into a competitive IgAN market with several existing therapies. Continued authorisation depends on further evidence from the ongoing Phase 3 I CAN trial on kidney function outcomes.

Top Movers

• Rentokil Initial (LSE:RTO) surged 8.61% after confirming 2026 profit guidance, organic revenue growth and a US$200m buyback.

• London Stock Exchange Group (LSE:LSEG) jumped 7.69% after lifting 2026 guidance and announcing the US$3.54b Octus acquisition.

• Rightmove (LSE:RMV) gained 3.63% as investors reacted to recent director share purchases and updated broker commentary.

Top Losers

• Hochschild Mining (LSE:HOC) fell 8.45% after quarterly production data showed lower silver and total silver equivalent volumes.

• ITM Power (AIM:ITM) declined 6.76% after full year results showed higher sales but a continued net loss.

• Fresnillo (LSE:FRES) dropped 6.46% as weaker silver and copper prices weighed on the precious metals sector.

On The Radar

UK data and bank earnings dominate the next few sessions, with retail sales, housing indicators and big high street lenders all feeding into how you think about domestic demand and rate sensitivity.

• UK Retail Sales (MoM and YoY) Fri 23 Oct. A monthly move versus the 0.5% prior and a consensus of 0.1% decline, along with annual growth against the 2.4% previous and 1% consensus, shapes how far consumer spending is absorbing higher borrowing costs.
• UK S&P Global PMIs Fri 23 Oct. Manufacturing and services readings compared with September levels of 51.9 and 52.1, and forecasts near 51.8, feed directly into how resilient UK activity looks alongside 3.5% headline inflation and 4.6% producer prices.
• HSBC Holdings Tue 27 Oct. Third quarter results put the focus on margins and impairment charges in a higher for longer rate setting, which matters for how investors price UK bank earnings against sticky domestic inflation and elevated public borrowing.
• Lloyds Banking Group Thu 29 Oct. When the lender reports at 7:00 AM UTC, net interest income and deposit trends will show how a UK focused balance sheet is handling 3.5% CPI and 2.8% core inflation without over relying on repricing loans.
• Shell Thu 29 Oct. Third quarter numbers bring capital spending, upstream cash flow and any commentary on oil price moves into focus for UK energy exposure, especially after producer prices were led higher by coke and refined petroleum products.

Sector & Industry Watch

Metals and Mining: Project spending contrasts weaker prices

Metals and Mining has had a tough week, with a clear pullback over seven days and the past month even as companies commit fresh capital. Rio Tinto is putting US$1.9b into the Kangwinan bauxite project and Metals One is buying full control of the Barbrook gold mine, so long dated supply plans are still being funded.

For anyone holding miners, the most important near term signal is today’s UK Manufacturing PMI flash, since softer factory order readings would keep pressure on expectations for iron ore, bauxite and other industrial metals demand.

Consumer Discretionary: Rate sensitive spending under the microscope

Consumer Discretionary has inched higher over the past week after a tougher year, helped by better updates from Pearson and InterContinental Hotels while Inchcape trims its margin outlook. With UK CPI at 3.5% and core at 2.8%, extra spending on hotels, education services and big ticket items is closely linked to pay packets and mortgage payments.

The swing factor is this morning’s UK Retail Sales release for September, which gives a clean read on whether shoppers are pulling back on non essential purchases compared with last year.

Pharmaceuticals & Biotech: Drug approvals support sector sentiment

Pharmaceuticals & Biotech has pushed higher over seven days, helped by AstraZeneca securing two accelerated US FDA approvals and GSK progressing its tuberculosis vaccine into phase 3 trials. These product milestones give this group revenue opportunities that are less directly tied to UK inflation or domestic rate expectations.

The next key check point is the upcoming Q3 reporting season for the large pharma stocks, where attention will be on how research spending and newly approved medicines are feeding into overall profitability.

Banks: Cost cuts meet softer recent tone

Banks have slipped over the past week after a strong year to date, as investors weigh sticky UK inflation against funding and savings rates that remain sensitive. Barclays is cutting around 5,000 jobs and leaning on AI linked efficiency to manage costs, which shows how lenders are trying to protect returns when interest rate expectations stay elevated.

The clearest near term signal for UK listed lenders is Tuesday’s Q3 results from HSBC, where any comments on loan demand, deposit pricing and credit quality can quickly sway sentiment toward the wider banking sector.

Utilities: Income focus returns with inflation firm

Utilities have moved higher over the last week and month, reflecting interest in relatively steady dividend payers while UK headline CPI holds at 3.5%. Companies such as National Grid still face questions around who pays for future grid and energy investments, bill payers or shareholders, which matters for both income and growth potential.

This sector is closely linked to Bank of England rate expectations because changes in long dated gilt yields feed straight into borrowing costs and how investors compare utility dividends with government bond income.

Identify The Next Market Leaders

With UK headline CPI holding at 3.5% and rate expectations still firm, income focused investors can start with this list of 225 dividend fortresses as a way to stress test dividend ideas against higher borrowing costs.

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