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On Thursday, the FTSE 100 in the UK started the day with a decline, influenced by stronger-than-expected economic data from the United States, which reignited concerns about the possibility of higher interest rates being maintained for an extended period. This sentiment was exacerbated by a sharp drop in Wall Street's main indexes on Wednesday with further weakness seen today, following data indicating that the U.S. services sector unexpectedly gained momentum in August, suggesting the persistence of inflationary pressures. Adding to the negative tone, economic data revealed a decrease in both exports and imports for China in August. This decline was attributed to the dual challenges of weakening foreign demand and subdued consumer spending, impacting businesses in the world's second-largest economy. As a result, commodity-related stocks, particularly metal miners, faced a 1.1% decrease, leading the sectoral declines in the FTSE 100, however, the index managed to stabilise amidst a sea of red on global markets eking out a 0.14% gain heading into the close.

Support for the blue chip index came from Melrose Industries PLC experienced a significant surge in its shares on Thursday, driven by the release of robust interim results that prompted an upgrade in its full-year guidance. The company also announced an increase in its dividend and an early start to its share buyback program, coinciding with the upcoming departure of Co-Founder and Chief Executive Simon Peckham in March next year. Shares of the Birmingham-based aerospace manufacturer climbed by 8.1% at its peak, making it the top-performing stock on the FTSE 100 for the session. Melrose reported that it exceeded expectations in the first half of 2023, with revenue rising from GBP1.36 billion to GBP1.63 billion year-on-year, and a significant reduction in pre tax loss from GBP314 million to GBP62 million. The company also announced an interim dividend of 1.5 pence per share, up from 0.825p in the previous year. Additionally, Melrose disclosed its plan to initiate its share buyback program early, commencing in October with a GBP500 million buyback over a 12-month period. Looking forward, Melrose revised its annual guidance, anticipating an Aerospace adjusted operating profit ranging between GBP375 million and GBP385 million, surpassing its previous guidance by over 8%. The company also expects revenue in the range of GBP3.35 billion to GBP3.45 billion.

On the negative side of the ledger sitting bottom of the index was Smurfit Kappa shares faced a 4.4% decline, in response to potential developments involving a merger with U.S. competitor WestRock. This proposed merger would unite two major players in the global paper and packaging industry. The combined entity resulting from this merger is expected to bear the name "Smurfit WestRock" and be legally based in Ireland, with its global headquarters located in Dublin. However, specific financial terms of the potential deal have not yet been disclosed.

FTSE Bias: Bullish Above Bearish below 7525

• Above 7550 opens 7576
• Primary resistance is 7625
• Primary objective 7335
• 20 Day VWAP bearish, 5 Day VWAP bearish

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