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The FTSE 100, the UK's main stock index, dropped to a two-week low on Wednesday as Ashtead continued to decline, while investors cheered U.S. inflation figures that solidified the Federal Reserve's decision to cut rates in December. The UK benchmark reversed early losses to trade higher on the session, gaining over 0.5%. Precious metal miners saw a 1% increase as gold prices remained close to a two-week high, driven by rising geopolitical tensions and expectations of a U.S. rate cut. Investors globally are awaiting a U.S. consumer price index report later today for insights into inflation and the Federal Reserve's subsequent policy. Traders largely anticipate a quarter-point cut at the central bank's policy meeting next week. In contrast, the Bank of England is likely to maintain interest rates next week, proceeding more cautiously in reducing borrowing costs compared to central banks in Europe and the U.S. The gross domestic product estimate for October, set to be released on Friday, will serve as a crucial economic indicator ahead of the BoE's decision. Furthermore, the European Central Bank's rate decision on Thursday is also being closely monitored, with markets expecting a decrease in borrowing costs. Domestic investors will also evaluate a reading from the RICS Housing Survey, which is due later today.

Single Stock Stories:

• Shares of UK retailers, such as Primark owner ABF and Next, declined following Inditex's announcement of weaker-than-anticipated quarterly earnings. ABF's shares fell by about 1.5%, making it one of the top percentage losers on the FTSE 100, which itself decreased by 0.3%. Meanwhile, Next's shares dropped roughly 1%. Inditex reported a nine-month net profit of 4.44 billion euros, falling short of analysts' projections. Year-to-date, ABF's stock has decreased by approximately 8%, whereas Next's shares have risen by around 19%.

Broker Updates:.

• Shares of Ashtead Group Plc have dropped by as much as 6.9% to 5,022p, marking the lowest point since August 5. The stock is the largest percentage loser on the FTSE 100 index. Goldman Sachs analysts have downgraded the rental equipment company's stock from a "buy" to a "neutral" rating, with a target price of 6,600p. The brokerage indicates that Ashtead's half-year results reveal ongoing uncertainty in the company's revenues due to weakness in local commercial construction markets and a higher interest rate environment. "The company has stated that they do not anticipate a recovery in this segment until the latter half of calendar 2025, which we believe poses risks to revenue growth for FY25 and FY26," according to Goldman Sachs. AHT experienced a 14% decline on Tuesday after revising its revenue and profit forecasts downward due to continued weakness in the U.S. construction market. Bernstein has reduced its target price to 6,200p from 6,800p, while RBC has lowered its target price to 6,750p from 7,450p. Out of 22 brokerages, 14 rate the stock as "buy" or higher, 7 as "hold," and 1 as "sell" or lower, with a median target price of 6,550p, according to LSEG data.

Technical & Trade View

FTSE Bias: Bullish Above Bearish below 8225

• Primary support 8000
• Below 8000 opens 7855
• Primary objective 8600
• Daily VWAP Bearish
• Weekly VWAP Bullish

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