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On Wednesday, the FTSE 100 in the UK continued to decline due to higher-than-expected inflation, which reduced expectations for significant interest rate cuts this year. Additionally, disappointing data from China negatively affected mining and energy companies. The blue-chip index dropped 1.3%, marking a third consecutive session of losses and reaching a low not seen in a month and a half. The FTSE 100 was under pressure as sterling edged up following a report that showed an increase in Britain's annual consumer price inflation for the first time in 10 months in December, attributed to a rise in tobacco duty. This has reduced investors' confidence in the Bank of England cutting rates in May, with traders now estimating a 50% chance of the central bank holding rates in May.

On the positive side of a largely negative ledger Goldman Sachs upgraded IMI shares to 'buy' from 'neutral' and raised the price target to 2,020p from 1,780p, citing a potential 30% upside compared to 17% for the sector. The bank sees IMI benefiting from a sustained capex super-cycle and a potential recovery in short-cycle industrial production. This is supported by recent ISM manufacturing PMIs indicating that inventories may be nearing a low point. The upgrade left IMI sitting at the top of the blue chip index gaining 3.6% on the session.

Leading the charge lower UK homebuilders and property stocks are experiencing a decline as hopes for a rate cut are dampened by a boost in inflation. Both the UK homebuilders' index and the FTSE Real Estate index, which includes commercial property firms and real estate investment trusts (REITs), have each declined by 2.2%. This decline comes as shares of UK real estate firms fall following a surprising increase in Britain's annual rate of consumer price inflation in December, the first rise in 10 months, leading investors to lower their expectations for a rate cut. In the housing sectorFTSE 100 housebuilders Persimmon and Barratthave slipped by 5% and 3.9% respectively. The two homebuilders were pipped to the bottom spot by Ocado which shed over 6% today, shareholders are down 16% for the year, which is worse than the broader market decline of 3.0%. It could be due to the share price being impacted by broader market concerns.

FTSE Bias: Bullish Above Bearish below 7500

• Below 7375 opens 7320
• Primary support at 7382
• Primary objective 7827
• 20 Day VWAP bearish 5 Day VWAP bearish

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