FTSE 100 Hits Four-Month Peak Amid UK Policy Shifts

The FTSE 100 reached a four-month peak of 10,733.96 on July 22, 2026, following a period of recovery and volatility. Market gains were driven by strong performance in energy, mining, and aerospace stocks, bolstered by reports from the Office for National Statistics that consumer price inflation slowed to 2.6% in June, down from 2.8% in May. This followed earlier data showing the UK unemployment rate held steady at 4.9% for the three months ending in May.

Andy Burnham implemented a series of domestic measures to address the cost of living. The Prime Minister appointed John Healey as Chancellor, sparking a rally in defense stocks, and pledged to reduce energy bills by scrapping the Digital ID Programme. He also announced a £2 cap on single bus fares in England starting in January and proposed raising business rates on large warehouses to fund a 20% rates cut for pubs and music venues, describing these efforts as "breathing space" for households.

Global markets remained volatile due to geopolitical tensions. The United States completed 11 consecutive evenings of strikes against Iran, pushing Brent crude prices above $94 a barrel. Additionally, Donald Trump announced tariffs of 100% to 200% on generic drugs effective August 1, 2028. In the corporate sector, Mitie agreed to a £3.1 billion takeover by OCS, while JD Wetherspoon issued a profit warning and Reach reported a 40% drop in page views due to Google's AI overviews.