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London's FTSE 100 climbed closer to a record high on Wednesday, buoyed by investor optimism following the UK spending review. The British homebuilders index surged 2.23% after Finance Minister Rachel Reeves unveiled plans, including a £10 billion investment in new housing. The UK Government's £39 billion, decade-long initiative is set to nearly double annual spending on affordable housing. Rachel Reeves might need to generate as much as £23 billion in extra revenue in the upcoming autumn budget to support new spending promises and address political demands from Reform UK, according to economists' warnings. The Chancellor is faced with "three undesirable choices": reducing public expenditure, easing her self-imposed fiscal constraints, or increasing taxes. Weak UK jobs data strengthens the case for the Bank of England (BoE) to continue gradual rate cuts. The key question is whether the BoE will accelerate easing, possibly considering a September rate cut. While the June 19 meeting is expected to keep rates unchanged, focus lies on a potential 6-3 MPC vote split. A September cut, currently priced at 25%, becomes more likely with further downside inflation surprises, as seen in the euro area and U.S. Sterling faces pressure, particularly against the euro, though officials may wait for more inflation and jobs data before signalling a stronger dovish stance. Hawkish arguments within the BoE have notably weakened.

Single Stock Stories & Broker Updates:

• Shares of the real estate investment trust PRS REIT have decreased by 3.2%, now priced at 115 pence. The company has received a buyout offer from the UK real estate firm Long Harbour, valuing the shares at £631.6 million ($853.35 million) or 115p per share, which represents a 3.3% discount compared to PRSR's closing price on Tuesday. Earlier on Wednesday, PRSR reached a record high of 125p following a report from Sky News about the potential offer. The company anticipates providing an update on the sale process by the end of June. Overall, with the session's fluctuations included, the stock has increased by approximately 7% year-to-date.
• Shares of Argentex fell 14.54% to 2.35p, making it one of the top losers in London. Significant internal issues were missed by risk management and stress testing, revealing systemic problems with new products and unclear risks. The company is addressing these issues and working with the Financial Conduct Authority to improve systems before its takeover by IFX Payments. As of Tuesday's close, the stock is down 90.5% in 2025.
• FTSE 100 homebuilder Taylor Wimpey increased by 1.2%, Barratt and Redrow both rose by 1.4%, and Persimmon saw a rise of 1.7%. Affordable homebuilder Vistry surged approximately 8.2%, leading the FTSE mid-cap index, while Crest Nicholson experienced a 5.9% increase. Homebuilder Bellway also gained around 3%.
• Wealth manager Quilter's shares rose 4% to 162.80p, the highest in over 3 months. Stock among top gainers on FTSE 250, which increased 0.4%. UBS upgraded QLT to "buy" from "neutral," raising the price target to 190p from 165p, citing stronger platform flows and improved cash flow. The average stock rating is "hold" with a median price target of 155p. Year-to-date, QLT has gained nearly 3.57%.
• Consulting firm Ricardo shares rise 25.7% to 420.4p, marking its largest one-day gain since March 2020. WSP Global plans to acquire Ricardo for an enterprise value of £363.1 million ($488.99 million), valuing Ricardo at approximately £281 million. Shareholders will receive 430p per share. Science Group, holding 21.8% of voting rights in Ricardo, supports WSP's offer and will sell a 20% stake for about £53.5 million. Year-to-date, Ricardo shares are down nearly 20%.
• Shares of Assura rise 2.2% to 50.1p as KKR and Stonepeak Partners increase their offer to nearly £1.7 billion ($2.29 billion), proposing 52.1p per share. This offer surpasses the previous £51.7p proposal from Primary Health Properties. Year-to-date, Assura is up ~30.20%, while KKR is down ~16.15%.

Technical & Trade View

FTSE Bias: Bullish Above Bearish below 8700

• Primary support 8500
• Below 8500 opens 8250
• Primary objective 8900
• Daily VWAP Bullish
• Weekly VWAP Bullish

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