Retail sales figures and the largest surplus on the UK’s public finances since records began in 1993 today provided a boost to Chancellor Rachel Reeves.
The FTSE 100 index moved higher after yesterday falling back from Wednesday's record close.
Traders are also focused on the price of Brent Crude, which has risen on the back of fears of supply disruption in the Middle East.
FTSE 100 Live Friday
- Retail sales bounce
- Public finances record
- Oil price six-month high
A burst of economic cheer today lifted NatWest and Lloyds Banking Group shares as the FTSE 100 index enjoyed a strong finish to the week.
The top flight rose 55.13 points to 10,682.17 after retail figures showed a surprise bounce in volumes for January, up 1.8% in the best performance since May 2024.
The UK’s latest purchasing managers’ index report also offered encouragement after the headline score edged up to 53.9 from 53.7 in January.
The updates meant a push back against rate cut expectations, which benefited Lloyds and NatWest after their shares fell on Wednesday’s inflation reading.
They improved 1.45p to 103.45p and 6.6p to 623.8p respectively, while Barclays rallied 7.1p to 475.05p.
The FTSE 100 was led by Burberry, which added 36p to 1210.5p, and by Centrica as shares recovered from yesterday’s results-day fall with a rise of 5.25p to 191.15p.
Diageo, which posts half-year figures next week, rose 37.5p to 1819p and St James’s Place rallied 24.5p to 1295.5p after UBS switched to a Buy stance.
On the fallers board, BP gave up some of the gains seen following this week’s surge in the price of Brent Crude to a six-month high.
The oil benchmark today settled at $72 a barrel as traders focused on the potential for supply disruption in the event of US military intervention in Iran.
BP fell 7.15p to 471.85p and Shell retreated 11.5p to 2932.5p.
Market update: FTSE 100 rallies amid UK cheer, Centrica recovers
10:09 , Graeme EvansA burst of economic cheer today lifted NatWest and Lloyds Banking Group shares as the FTSE 100 index enjoyed a strong finish to the week.
The top flight rose 55.13 points to 10,682.17 after retail figures showed a surprise bounce in volumes for January, up 1.8% in the best performance since May 2024.
The UK’s latest purchasing managers’ index report also offered encouragement after the headline score edged up to 53.9 from 53.7 in January.
The updates meant a push back against rate cut expectations, which benefited Lloyds and NatWest after their shares fell on Wednesday’s inflation reading.
They improved 1.45p to 103.45p and 6.6p to 623.8p respectively, while Barclays rallied 7.1p to 475.05p.
The FTSE 100 was led by Burberry, which added 36p to 1210.5p, and by Centrica as shares recovered from yesterday’s results-day fall with a rise of 5.25p to 191.15p.
Diageo, which posts half-year figures next week, rose 37.5p to 1819p and St James’s Place rallied 24.5p to 1295.5p after UBS switched to a Buy stance.
On the fallers board, BP gave up some of the gains seen following this week’s surge in the price of Brent Crude to a six-month high.
The oil benchmark today settled at $72 a barrel as traders focused on the potential for supply disruption in the event of US military intervention in Iran.
BP fell 7.15p to 471.85p and Shell retreated 11.5p to 2932.5p.
Anglo American results hit by De Beers impairment
10:01 , Graeme EvansAnglo American has written down the value of its De Beers diamond business by another $2.3 billion (£1.7 billion) amid a slump in demand for precious gems.
The FTSE 100 firm posted net losses of $3.7 billion (£2.8 billion) in 2025, due largely to the impairment charge on De Beers in its third such write down in three years.
On an underlying basis, Anglo’s earnings edged 2% higher to 6.4 billion dollars (£4.8 billion).
Anglo has been trying to sell De Beers – in which it has an 85% stake – due to a lengthy downturn in the diamond market and amid the rise in synthetic lab-grown diamonds.
Shares rose 31.9p to 3609.9p.
Aston Martin Lagonda trims profit guidance
09:57 , Graeme EvansAston Martin Lagonda has warned it will post lower-than-expected annual profits as it battles ongoing pressure from US tariffs.
The update came as the luxury car maker also announced the sale of naming rights for its Aston Martin F1 team to a related party to help bolster its finances.
The car maker told shareholders on Friday that gross profit margins and adjusted earnings before interest and tax are set to be “slightly below” the lower end of analyst expectations.
Shares fell 0.6p to 58.9p.
FTSE 100 higher, Burberry shares rise 3%
08:18 , Graeme EvansThe FTSE 100 index is up 15.12 points to 10,642.16, having fallen back from a peak of 10,674 at the opening bell.
Stocks on the front foot include Lloyds Banking Group, which put back recent losses with a rise 0.85p to 102.85p.
Burberry lifted 3% or 35.5p to 1210p and St James’s Place added 51.5p to 1322.5p after UBS upgraded the wealth management firm to a Buy stance.
Anglo American rose 15p to 3593p after the mining giant posted annual results, including a 2% rise in underlying earnings. The full-year dividend fell 27% to 16 US cents a share.
EDF earnings fall in UK, nuclear output down 12%
08:08 , Graeme EvansEDF has revealed that a fall in prices and a prolonged outage at one of its nuclear power stations dragged on UK profits last year.
The French company said nuclear output from its five active power stations decreased by 12% last year, compared with 2024.
EDF’s nuclear fleet provided about 12% of the UK’s total power demand last year, which it says makes it Britain’s biggest generator of zero carbon electricity.
UK earnings were £1.9 billion for 2025, down about a third from £2.9 billion in 2024.
New year lift for Chancellor ahead of fiscal statement
08:01 , Graeme EvansChancellor Rachel Reeves has received a boost ahead of next month’s fiscal statement after retail sales and January’s public sector surplus easily beat forecasts.
Today’s record surplus means cumulative public borrowing for the first ten months of 2025/26 is now £112.1 billion, some £14.6 billion below last year’s figure.
Meanwhile, the 1.8% month-on-month rise in retail sales volumes in January was much better than the City consensus forecast of 0.2%.
Capital Economics said it was clear that the economy has strengthened since the end of last year.
The consultancy said: “The big reduction in public borrowing and surge in retail sales in January support other evidence that the economy started the year looking a lot healthier and will give the Chancellor something positive to point to in her Fiscal Statement on 3 March.”
Brent crude at six-month high amid Iran disruption fears
07:51 , Graeme EvansOil traders are braced for the possibility of US military intervention in Iran after the price of Brent crude rose towards a six-month high at $72 a barrel.
The developments have echoes of last June, when targeted US strikes on Iran quickly added $10 a barrel to Brent crude prices.
The market for Iranian oil exports is already constrained by economic sanctions.
However, Shore Capital said the greater risk is that Iran’s response to US aggression is to disrupt tanker movements in the Strait of Hormuz, through which about 20% of global oil supplies and about 20% of LNG passes.
Shore said: “This would represent a significant escalation of the conflict by Iran, as it would impact exports from Saudi Arabia and other Middle Eastern oil and LNG producers, along with their customers (particularly China and India).”
Public finances post record surplus
07:13 , Graeme EvansThe UK’s public finances today recorded the highest surplus in any month since records began in 1993.
The figure of £30.4 billion for the tax receipt month of January was double the same month last year and £6.3 billion above the Office for Budget Responsibility’s November forecast.
National insurance contributions jumped by almost a fifth on a year ago to £17.7 billion.
ONS chief economist Grant Fitzner said: “January – which is traditionally a strong month for self-assessed tax receipts – saw the highest surplus since monthly records began.
“Revenue was strongly up on the same time last year, while spending was little changed, due to lower debt interest payments largely offsetting higher costs on public services and benefits.
“Across the first ten months of the current financial year, borrowing is lower than the same period a year ago.”
Today’s record surplus means cumulative public borrowing for the first ten months of 2025/26 is now £112.1 billion, some £14.6 billion below last year’s figure.
Retail sales volumes show largest rise since May 2024
07:12 , Graeme EvansThe retail sector has recorded a strong start to the year after sales volumes jumped by a surprise 1.8% in January, the largest monthly rise since May 2024.
The Office for National Statistics (ONS) said growth was partly because of artwork and antiques sales, alongside continued strong sales from online jewellers.
Volumes rose by 0.1% in the three months to January, compared with the three months to October. Volumes were 2.6% higher than the same three months a yer ago.
ONS chief economist Grant Fitzner said: “Retail sales rose slightly in the latest three months, as sales continued to pick up in the new year following a weak November.
“Motor fuel sales increased a little across the period, while sales of art works, tech retailers and furniture stores also performed well. These were partially offset by falls in supermarket sales.”
Brent Crude price rises, index set for improved session
07:00 , Graeme EvansThe price of Brent Crude today continued to rise amid heightened fears of supply disruption in the Middle East.
The oil benchmark stood at $72.17 a barrel, having risen by 0.7% in Asia trading hours and by more than 6% this week.
The US threats of action against Iran unsettled the Dow Jones Industrial Average, which slipped 0.5% alongside 0.3% falls for the S&P 500 and Nasdaq Composite.
Stronger BP shares supported the FTSE 100 index yesterday but London’s top flight still fell 0.6% or 59.14 points at 10,627.04.
It is forecast to put back about 46 points at today’s opening bell.
