A weaker-than-expected US employment report, released yesterday, has also cheered traders by dampening expectations of rises in US interest rates.<\/p>\n
Dan Coatsworth, head of markets at AJ Bell, explained:<\/p>\n
double quotation mark\u201cWeak jobs numbers would normally be a key reason for central banks to consider cutting rates to stimulate the economy.<\/p>\n
The latest US jobs data confirms labour market disappointment but we\u2019re nowhere near the stage where the Fed will reach for the monetary policy scissors to start cutting. We\u2019re more likely to see an adjustment to the Fed\u2019s assessment that implies no change to rates, which is still a win for markets.<\/p>\n
Thirdly, investors are \u2018rotating\u2019 out of chip stocks (following a stellar start to the year) and into \u2018old economy\u2019 companies instead, and there are plenty of those on the London stock market.<\/p>\n
Share<\/a><\/p>\n Updated at\u00a009.33 CEST<\/p>\n Key events<\/p>\n Closing post: FTSE 100 finishes at four-month high<\/p>\n And finally\u2026.Britain\u2019s stock market has closed higher tonight.<\/p>\n The FTSE 100 index of blue-chip shares has just ended the day 26 points higher at 10,679, a gain of 0.25%.<\/p>\n That\u2019s its highest closing level in four months, since 2 March \u2013 the first trading day after the Iran war began.<\/p>\n The smaller FTSE 250 index gained 0.5% today.<\/p>\n Despite this morning\u2019s disappointing service sector data, investors remained confident after fears of interest rate rises this year faded.<\/p>\n There\u2019s also a continuing \u2018rotation\u2019 out of AI and chip stocks and into other sectors (although Wall Street is closed today, so we\u2019ll see next week if this trend continues).<\/p>\n These factors helped to push Germany\u2019s DAX share index to a new record high today too.<\/p>\n David Morrison, senior market analyst at fintech and financial services provider Trade Nation<\/a>, explains:<\/p>\n double quotation markBoth the Euro Stoxx 50 and German DAX soared to fresh all-time highs this morning. The UK\u2019s FTSE 100 was a touch weaker, while the FTSE 250 was a bit stronger.<\/p>\n Overall, investors were responding to strength across the US stock index futures contracts. But there\u2019s also a similar dynamic going on as the one which is driving the Dow to all-time highs, even as the pullback in tech stocks proceeds. Yet again, the tech-lite European indices are back in demand, even more so given that the stocks within them trade on much lower P\/E multiples than those typically seen over in the US. So, not only are Europe\u2019s indices less exposed to the AI trade, but they are also relatively cheap.<\/p>\n And that\u2019s all for this week. Have a lovely weekend\u2026. GW<\/p>\n Share<\/a>Mercedes-Benz workers protests against cutbacksEmployees of the automaker Mercedes-Benz demonstrating in Bremen, Germany, today. Photograph: Focke Strangmann\/DPA\/AP<\/p>\n Over in Germany, thousands of workers have been demonstrating outside Mercedes-Benz factories against its cost-cutting plans.<\/p>\n Workers rallied outside several Mercedes plants, from the southern city of Sindelfingen \u2013 outside Stuttgart \u2013 to Bremen in the north.<\/p>\n Workers were informed of potential measures \u2013 including increasing working hours for no extra pay \u2013 last month.<\/p>\n IG Metall union leader Christiane Benner told AFP newswire, at a protest in Duesseldorf:<\/p>\n double quotation mark\u201cWhile shareholders benefit more than handsomely, employees are supposed to sacrifice their contractually guaranteed rights.<\/p>\n \u201cThis is how you squander the future and trust.\u201d<\/p>\n Mercedes-Benz protest in Sindelfingen, Germany, today Photograph: Bernd Weissbrod\/DPA\/APShare<\/a><\/p>\n There are two sides to every trade. And thus, as the pound heads for its best week since early April (see earlier post<\/a>), the US dollar is on track for its worst.<\/p>\n The dollar index \u2013 which tracks the greenback against a basket of currencies \u2013 has lost 0.5% this week, the biggest weekly drop since early April. It weakened after yesterday\u2019s poor US jobs report, which knocked forecasts for US interest rate rises.<\/p>\n Share<\/a>Brazil’s services sector gets World Cup liftA street fair in Ipanema with a painted mural of Canarinho, the yellow canary mascot of Brazil’s national soccer team, in Rio de Janeiro. Photograph: Bob Karp\/ZUMA Press Wire\/Shutterstock<\/p>\n Brazil\u2019s services industry has won a boost from the World Cup.<\/p>\n Business activity at Brazilian services firms rose in June, a poll of purchasing managers shows. Companies reported a pick-up in sales last month, as World Cup-related viewing events, hospitality spending and media activity helped support demand.<\/p>\n But while demand to watch Vinicius Junior, Casemiro, Gabriel and the gang lifted output, firms cut jobs for the first time in five months.<\/p>\n Pollyanna De Lima, economics associate director at S&P Global Market Intelligence, explains:<\/p>\n double quotation mark\u201cThe renewed rise in new business and quicker growth in activity are certainly an improvement on the previous month\u2019s trends. But with Brazilian services firms mostly linking June\u2019s upturn to a World Cup boost, the recovery looks likely to be short-lived.<\/p>\n \u201cThat temporary nature is already showing up elsewhere in the survey, with service providers cutting jobs and downgrading their business expectations.<\/p>\n \u201cServices companies are also facing stronger cost pressures from the war in the Middle East, although inflation may have peaked this month. Many will likely try to recoup those costs gradually in the months ahead, which will further test demand. That comes on top of the expected slowdown as this year\u2019s presidential election approaches and external shocks continue to weigh on activity<\/p>\n Share<\/a>Gulf oil exports jump in June<\/p>\n Back in the oil market, new data shows that exports from the Gulf jumped in June.<\/p>\n Gulf oil exports rose by more than 3 million barrels in June, compared with May, to exceed 10 million barrels per day.<\/p>\n Reuters has the details:<\/p>\n double quotation markThe United Arab Emirates led the recovery, allowing millions of barrels of crude stranded in the Gulf to reach international markets, enabling producers to raise output and lower oil prices to pre-conflict levels.<\/p>\n Combined crude and condensate exports from Saudi Arabia, the UAE, Kuwait, Iraq and Iran rose by more than 3.5 million bpd from May to 10.07 million bpd, Kpler data shows.<\/p>\n Share<\/a>UK electric car sales jumped in June<\/p>\n Elsewhere in the car industry, sales for electric vehicles jumped last month, according to new industry data.<\/p>\n Research organisation New AutoMotive has reported that 64,000 new electric cars were registered in June, a 37.7% year-on-year increase.<\/p>\n That means that electric cars made up 30% of the market last month, with some drivers keen to avoid the jump in petrol and diesel prices after the Iran war began.<\/p>\n Overall, car sales were up almost 15% year-on-year in June.<\/p>\n Ben Nelmes, CEO at New AutoMotive, explains:<\/p>\n double quotation mark\u201cJune\u2019s data shows that electric cars are rapidly becoming the mainstream choice for British drivers. With one in three new cars registered in June being fully electric, motorists are switching at an extraordinary pace.<\/p>\n \u201cAs petrol and diesel sales continue their steady, structural decline, it\u2019s clear that drivers are voting with their wallets. EVs offer families and businesses lower and predictable running costs, a superior driving experience, and an escape from the volatile global oil markets that have squeezed household budgets for too long.\u201d<\/p>\n Share<\/a>JLR sales hit by major fire and Iran war disruption Jaguar Land Rover suffered a 9% drop in sales in the last quarter caused by disruption from the Iran war and a major fire at a Norwegian supplier that forced Britain\u2019s largest carmaker to shut its factories temporarily.<\/p>\n The manufacturer today reported sales of 79,300 cars to dealers in the three months to June, a 9.2% decline compared with the same period a year earlier.<\/p>\n The company insisted the disruptions were \u201ctemporary supply constraints\u201d, including the fire<\/a> at Raufoss Technology, a Norwegian manufacturer of aluminium parts for car suspensions.<\/p>\n JLR also said the US-Israeli war on Iran caused \u201cmarket disruption\u201d, as Iran responded by attacking several Gulf neighbours, several of which are large markets for luxury cars such as Range Rovers. Retail sales dropped by 42% in the Middle East and north Africa region, the company said.<\/p>\n Sales to customers were down across every market during the quarter, JLR said, although four-fifths of the sales were of more profitable models.<\/p>\n Share<\/a>CNBC: Christine Lagarde leaves door open to early ECB exit<\/p>\n The European Central Bank\u2019s Christine Lagarde has declined to rule out an early end to her term as president, as she mulls a foray into French politics, CNBC report<\/a>.<\/p>\n Lagarde, whose term as ECB President ends in October 2027, told French newspaper Les Echos an early departure is \u201cpossible\u201d ahead of the country\u2019s presidential elections that year.<\/p>\n She said:<\/p>\n double quotation mark\u201cI think a European voice must be heard in the French presidential debate.<\/p>\n If this debate were to present a perspective that diminishes France\u2019s place within Europe, I think it would be necessary to explain why this would be a painful path for our country and our citizens.\u201d<\/p>\n Asked whether she would consider personal involvement in the French Presidential campaign, to support a candidate or run herself, Lagarde said: \u201cI\u2019m going to ask myself some questions.\u201d<\/p>\n Share<\/a><\/p>\n Although UK service sector business optimism improved in June, it remains much softer than at the start of 2026, despite peace talk efforts between the US and Iran.<\/p>\n Thomas Pugh, chief economist at audit, tax and consulting firm RSM UK suggests UK political uncertainty hit confidence last month.<\/p>\n double quotation mark\u201cThe final composite PMI weakened further in June, suggesting that the economy has stagnated across Q2. Indeed, we doubt growth will pick up much through the rest of the year. Even if a Burnham coronation is likely, avoiding a protracted leadership contest, there will still be speculation about the direction of fiscal policy in the coming months. Meanwhile, the US-Iran peace deal isn\u2019t fully secured as yet. All of that will keep uncertainty elevated, limiting growth to around 0.1% per quarter for the rest of the year.<\/p>\n \u201cThe weak PMI continues to be driven by services activity, which is the lowest since January 2023, where anecdotal evidence suggests that the war in the Middle East and domestic political turmoil continues to dampen sentiment, prompting consumers to pull back on discretionary spending. In the immediate term, activity may remain weak with new orders dropping to the weakest since July 2025 as uncertainty weighs on activity and stockpiling in the manufacturing sector inevitably unwinds.<\/p>\n \u201cWhat\u2019s more, the downwards revision to the future activity balance between the flash and final release suggests that firms responding later in the month were more pessimistic about the outlook following Starmer\u2019s resignation. We think sentiment will remain weak until firms have a clearer idea of the direction of fiscal policy at the next budget.<\/p>\n Share<\/a>Sterling set for biggest weekly jump since early April<\/p>\n The pound is heading for its biggest weekly jump in 12 weeks against the US dollar, as the City takes the looming coronation of Andy Burnham as Labour leader and prime minister in its stride.<\/p>\n Sterling has jumped by 1.2% so far this week, it\u2019s biggest weekly rise since the first week of April, to $1.3355.<\/p>\n The pound has risen against the US dollar for seven days in a row, helped by Burnham pledging to work within the existing fiscal rules.<\/p>\n The dollar has been dropping generally, as expectations of interest rate rises have fallen, and optimism over the US-Iran peace deal have spurred demand for riskier currencies.<\/p>\n Share<\/a><\/p>\n Updated at\u00a012.12 CEST<\/p>\n The FTSE<\/a> 100 couldn\u2019t hold onto its four-month high.<\/p>\n The blue-chip share index is now in the red, down 45 poinrs or -0.4% at 10,607 points, with the drop in UK service sector activity dampening the mood in the City.<\/p>\n Share<\/a>Wider UK economy shrank too<\/p>\n The drop in service sector activity in June pulled the wider British private sector into contraction.<\/p>\n Services make up around three-quarters of the UK economy, which shrank slightly in June for the second month running.<\/p>\n The UK Composite PMI (which tracks activity across the economy) dropped to 49.3, down from 49.7 in May and below the neutral 50.0 value for the second month running.<\/p>\n![\"Jasper](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/07\/Jasper_Jolly.png\")
Jasper JollyThe Jaguar Land Rover vehicle manufacturing plant in Castle Bromwich, Birmingham. Photograph: Christopher Furlong\/Getty Images<\/p>\n