London's FTSE 100 is anticipated to fall when markets open today, following the US Federal Reserve's decision to keep interest rates unchanged. This move comes amid increasing expectations of inflation, further fuelled by renewed attacks on Iran.
Futures prices indicate a drop of about 0.6% for the FTSE 100. The UK's blue-chip index reached a new record high of 10,951 points on Wednesday morning before closing at 10,864.
Analysts at Deutsche Bank, led by Peter Sidorov, attributed the market shifts to the Federal Reserve's "on-hold Fed decision combined with a relative lack of detail from Chair Warsh." Bond yields rose after the Fed meeting, suggesting investor doubts about the Fed's ability to control inflation.
Despite the broader market decline, some UK companies reported strong results. Jet engine manufacturer Rolls-Royce raised its profit guidance again, now expecting between £4.7bn and £4.9bn in underlying operating profit and £3.8bn to £4.0bn in free cash flow for the full year.