Walker Crips' Market Commentary

Last week, UK investors closely monitored macroeconomic signals while looking ahead to the Bank of England's (“BoE”) forthcoming monetary policy meeting, where expectations remain firm that the base rate will be held at 3.75%. The pressure on central bank decision makers remains intense as the domestic inflation picture continues to present a challenge. Headline Consumer Price Index (“CPI”) inflation reached 2.9% in July, and market participants are awaiting Wednesday's August figures to gauge whether price pressures are broadening. However, domestic economic fundamentals provided a welcome boost at the end of the week, with UK gross domestic product (“GDP”) data outperforming forecasts and indicating resilience in business activity. This positive surprise buoyed overall market sentiment, further supported by perceived political stability under Prime Minister Andy Burnham, whose strong public approval ratings continue to reassure international investors...Stocks featured:Associated British Foods, BP and Sage GroupTo find out more about the investment management services offered by Walker Crips, please visit our website:https://www.walkercrips.co.uk/This podcast is intended to be Walker Crips Investment Management’s own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise, so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Nothing in this podcast constitutes advice to undertake a transaction, and if you require professional advice you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN: 226344) and is a member of the London Stock Exchange.

Surging higher borrowing costs are expected to create further headwinds for the UK economy ahead of the 28 October 2026 budget, threatening to shrink the Treasury headroom by up to £12 billion, due to the 10-year government debt yields surging past 5.2%, as increasing energy prices reignited inflation concerns, prompting calls for the Bank of England (“BoE”) to pause active bond sales. In the consumer sector, demand figures appear mixed across hospitality and travel. Jet2 reported an 8.8% increase in booked passengers over the summer, reflecting resilient holiday spending, perhaps as a result of the recent heatwaves. Whilst Ryanair reduced its annual passenger target for 2027, issuing a warning that unhedged winter fuel will increase ticket prices if the elevated oil prices persist due to the conflict in Iran....Stocks featured:Airtel Africa, Experian and VodafoneTo find out more about the investment management services offered by Walker Crips, please visit our website:https://www.walkercrips.co.uk/This podcast is intended to be Walker Crips Investment Management’s own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise, so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Nothing in this podcast constitutes advice to undertake a transaction, and if you require professional advice you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN: 226344) and is a member of the London Stock Exchange.

Last week in the UK, economic data showed that optimism amongst British businesses grew in August as Lloyds Bank’s confidence index rose to 53%, the highest since the start of the Iran conflict. Business inflation expectations fell to a five-year low, whilst the latest Citi/YouGov survey showed an increase in the general public’s expectation of higher inflation, meaning that perhaps households are bracing themselves for higher prices. These contrasting data indicators can leave the Bank of England (“BoE”) in a difficult spot as rising inflation expectations are directly shifting rate forecasts, forcing money markets to push back expectations for the BoE’s next rate hike to February 2027...Stocks featured:BP, Computacenter and Melrose IndustriesTo find out more about the investment management services offered by Walker Crips, please visit our website:https://www.walkercrips.co.uk/This podcast is intended to be Walker Crips Investment Management’s own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise, so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Nothing in this podcast constitutes advice to undertake a transaction, and if you require professional advice you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN: 226344) and is a member of the London Stock Exchange.

Last week, Bank of England policymakers faced renewed monetary tightening expectations, especially as Chief Economist and Monetary Policy Committee member Huw Pill voted for rate hikes in four consecutive decisions, arguing that resilient quarterly growth of 0.4% in June supports higher interest rates. While Bank of England Governor Andrew Bailey had previously downplayed the possibility of rate cuts, comfortable leaving rates on hold, money markets now fully price further increases and anticipate upcoming hikes if oil prices continue to rise. UK Gross Domestic Product surprised on the upside in June by expanding 0.3% against expectations for a 0.1% contraction. This performance was driven by a notable 0.4% recovery in the services sector, with the UK Purchasing Managers' Index reaching a three-month high of 52.1, while total retail sales rose 1.3% in July, supported by a 10% surge in pub transactions....Stocks featured:Antofagasta, Computacenter and Lion Finance Group To find out more about the investment management services offered by Walker Crips, please visit our website:https://www.walkercrips.co.uk/This podcast is intended to be Walker Crips Investment Management’s own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise, so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Nothing in this podcast constitutes advice to undertake a transaction, and if you require professional advice you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN: 226344) and is a member of the London Stock Exchange.

Last week, Purchasing Manager’s Index (“PMI”) mixed signals pointed to a modest UK economic recovery. Whilst UK business activity saw a first rise in three months, driving the broader economy up, manufacturing and construction remain laggards, meaning that sustainable growth will depend on whether supply chain and inflation pressures continue to moderate. However, the geopolitical reasons are threatening this, as EY points out that the prolonged closure of the Strait of Hormuz could cause inflation to double, risking a UK recession. The recent heatwaves are also a threat, hampering retail footfall in July and potentially disrupting supply chains and causing prices to spike. The Bank of England (“BoE”) is also facing some scrutiny over its active quantitative tightening (“QT”) strategy, as the market is getting anxious over the valuation losses which ultimately strain public finances, creating a headwind to rate expectations and overall market sentiment...Stocks featured:Fresnillo, Endeavour Mining and IG GroupTo find out more about the investment management services offered by Walker Crips, please visit our website:https://www.walkercrips.co.uk/This podcast is intended to be Walker Crips Investment Management’s own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise, so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Nothing in this podcast constitutes advice to undertake a transaction, and if you require professional advice you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN: 226344) and is a member of the London Stock Exchange.

All eyes were on the Bank of England (“BoE”) on Thursday for its latest interest rate decision. The Monetary Policy Committee decided to hold the rate at 3.75%. This dovish stance comes after a split six versus three vote, where investors placed greater weight on the cautious remarks from Governor Andrew Bailey. The BoE remains alert over supply shocks such as oil volatility, food inflation, the easing of price pressures, which fell 0.9%, and a drop in public inflation expectations. Consumers are now drawing down Covid pandemic-era savings to help absorb the current living costs, which in turn is supporting modest retail resilience and pushing business confidence to a four-month-high. Some forecasters are now warning that persistent geopolitical friction and supply risks could weigh on economic expansion well into 2027, meaning the rate path remains complicated...Stocks featured:Burberry Group, Rentokil Initial and Sage GroupTo find out more about the investment management services offered by Walker Crips, please visit our website:https://www.walkercrips.co.uk/This podcast is intended to be Walker Crips Investment Management’s own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise, so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Nothing in this podcast constitutes advice to undertake a transaction, and if you require professional advice you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN: 226344) and is a member of the London Stock Exchange.

Last week, Bank of England policymakers faced renewed monetary tightening expectations, especially as money markets now fully price further increases and anticipate upcoming hikes if oil prices continue to rise. Elsewhere, the UK Purchasing Managers' Index reached a three-month high of 52.1, driven by a notable recovery in the services sector, and UK retail sales surprised on the upside in June, rising by 1% month-on-month against a consensus forecast of a 0.3% decline....Stocks featured:Anglo American, Segro and CentricaTo find out more about the investment management services offered by Walker Crips, please visit our website:https://www.walkercrips.co.uk/This podcast is intended to be Walker Crips Investment Management’s own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise, so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Nothing in this podcast constitutes advice to undertake a transaction, and if you require professional advice you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN: 226344) and is a member of the London Stock Exchange.

In the first of our new video podcast series, James Richards and Ben Potter discuss artificial intelligence ("AI") valuations, inflation, gold, gilts and where they see markets going for the remainder of 2026. Listen to the first episode of new Walker Crips podcast.Watch the video podcast on our Youtube channel here:https://youtu.be/TjU8ZxXJlIcTo find out more about the investment management services offered by Walker Crips, please visit our website:https://www.walkercrips.co.uk/This podcast is intended to be Walker Crips Investment Management’s own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Presenters and contributors to this podcast may hold personal positions in securities, assets, or themes discussed. These views are entirely their own and should not be interpreted as a recommendation to buy or sell any financial instrument. Nothing in this podcast constitutes advice to undertake a transaction and if you require professional advice, you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority and is a member of the London Stock Exchange.