FTSE 100 : A game of musical chairs

Stocks in Europe remained flat on Wednesday morning as investors braced themselves for the US Personal Consumption Expenditures (PCE) index release, a crucial inflation gauge for the Federal Reserve. The FTSE 100 managed a modest rise of 0.1%, while the Stoxx Europe 600 index slipped by 0.1%,  Across the pond, US markets displayed a stiff upper lip despite President Donald Trump's tariff threats aimed at China, Mexico, and Canada. The Dow Jones Industrial Average climbed by 0.3%, with the S&P 500 and Nasdaq Composite each advancing by 0.6%.

The Federal Reserve's recent minutes revealed a cautious stance on future interest rate cuts, with officials favoring a gradual approach as inflation inches towards the 2% target. Investors now eagerly await key US economic data, including GDP and personal consumption expenditures, due later in the day.

In the UK, the government unveiled a statutory levy on gambling operators to tackle problem gambling, channeling a significant chunk of the funds to NHS-led treatment.

On the corporate front, EasyJet soared with a 39% jump in annual pretax profit to £602 million, thanks to a record-breaking summer and robust demand for flights and holidays. Just Eat Takeaway announced plans to delist from the London Stock Exchange, aiming to cut administrative costs and complexity, while focusing on its primary listing in Amsterdam.

Anglo American pocketed approximately USD 527 million through a share offering of its subsidiary, Anglo American Platinum, as part of its divestment strategy. Aston Martin secured £211 million from a share offering and debt issue to fuel growth and its electrification strategy, despite revising its full-year earnings forecast. Mitchells & Butlers reported a robust annual performance, returning to profitability on the back of increased sales and cost efficiencies.

In index news, FTSE Russell hinted at potential reshuffles in the FTSE 100 and FTSE 250 indices. B&M European, Frasers, and Vistry might exit the FTSE 100, making way for Alliance Trust, Games Workshop, and St James's Place. In the FTSE 250, Ceres Power, Close Brothers, PZ Cussons, and Wood Group could be replaced by Deliveroo, Diversified Energy, Mobico, and Oxford Nanopore Technologies.

Meanwhile, in the Middle East, a ceasefire agreement between Israel and Hezbollah was reached, with Hamas expressing readiness for a similar accord in Gaza.

Things to read today:

• Quant Olympics aims to find the next generation of financial stars (Bloomberg).
• Are we accidentally building a planetary brain? (Noema)
• The way we measure AI progress sucks (MIT Technology Review).
• Is the decision to have a child rational (The Atlantic).