- FTSE 100 up 0.2%; FTSE 250 flat
- UK inflation unexpectedly rises in June
- AstraZeneca down after drug fails late-stage study goal
- Antofagasta gains on higher copper output
July 16 (Reuters) - London's main stock indexes were subdued on Wednesday, as a stronger-than-expected rise in domestic inflation slightly cooled bets of interest rate cuts from the Bank of England.
The blue-chip FTSE 100 was up 0.2% as of 1035 GMT, while the midcap FTSE 250 index was flat.
Britain's annual rate of consumer price inflation unexpectedly rose to its highest in over a year at 3.6% in June, as higher costs of motor fuel, transport and food pushed up prices.
"There is a real threat of stagflation as the rate of inflation moves higher and the economy is stuck in the mud. It puts the Bank of England in a tricky situation with regards to monetary policy decisions," said Dan Coatsworth, investment analyst at AJ Bell.
The central bank is largely expected to cut interest rates by a quarter-point in August after recent economic data fuelled concerns of weaker domestic growth and labour market, but the chances of such a move dimmed after Wednesday's inflation data.
The BoE will closely watch the employment and wages figures due on Thursday.
Meanwhile, UK finance minister Rachel Reeves on Tuesday announced measures to boost the finance sector, including reforming requirements for banks to separate retail and investment banking activities, easing regulations and a plan to get more savers investing in stocks.
In corporate updates, AstraZeneca fell 1.1% after the drugmaker's experimental therapy, anselamimab, failed to meet the main goal of a late-stage study for the treatment of AL amyloidosis, a rare condition that causes a buildup of protein deposits in the body.
Rio Tinto rose 1.3% after the mining giant reported its strongest second-quarter iron ore production since 2018, a day after promoting its iron ore chief Simon Trott to CEO.
Antofagasta edged up 0.5% after the Chilean miner said its copper production rose 11% in the first half of 2025, on improved output from its two concentrators.
Reporting by Ankita Yadav in Bengaluru; Editing by Shinjini Ganguli
Source: Reuters