18 August 2026
Last week, Bank of England (“BoE”) policymakers faced renewed monetary tightening expectations, especially as Chief Economist and Monetary Policy Committee member Huw Pill voted for rate hikes in four consecutive decisions, arguing that resilient quarterly growth of 0.4% in June supports higher interest rates. While BoE Governor Andrew Bailey had previously downplayed the possibility of rate cuts, comfortable leaving rates on hold, money markets now fully price further increases and anticipate upcoming hikes if oil prices continue to rise. UK Gross Domestic Product surprised on the upside in June by expanding 0.3% against expectations for a 0.1% contraction. This performance was driven by a notable 0.4% recovery in the services sector, with the UK Purchasing Managers' Index reaching a three-month high of 52.1, while total retail sales rose 1.3% in July, supported by a 10% surge in pub transactions.
In equities, the FTSE 100 index finished the week down. To ease household pressures and promote consumer protection, Prime Minister Andy Burnham launched a nationwide tour to unveil policy announcements addressing the cost of living. This included banning misleading retail prices and tricky subscription traps. Adding to the UK's economic challenges, extreme summer weather has taken a significant toll on productivity. Research from the think tank Verdant estimates that repeated heatwaves cost the economy £4.4 billion in lost output by the end of July, with June alone accounting for £2.36 billion.
Across the Atlantic, geopolitics moved back into consideration as tensions with Iran lingered. This heightened tension was further fuelled by reports that vessels were attacked as Tehran ratcheted up demands around the Strait of Hormuz. Hostilities ramped up further as fighting continued after Iran rejected a ceasefire proposal from President Trump. Such military escalations alongside geopolitical friction helped push West Texas Intermediate crude oil higher. Meanwhile, expectations surrounding the United States Federal Reserve shifted; the central bank saw pressure taken off its rate hike outlook following a cooler Producer Price Index of 4.7%. However, markets also navigated headwinds from Trump’s reimplemented tariffs, with duties of up to 12.5% on most major trading partners. Investors are currently pricing in a 28% chance of a September increase.
In markets, major US equities finished mostly higher last week. Domestic equities extended their previous gains, with the S&P 500 and Nasdaq both rising, whilst the Dow Jones dropped. Furthermore, semiconductor and memory stocks performed strongly following notable momentum in artificial intelligence infrastructure names. Elsewhere, the Dollar weakened, and Gold strengthened.
The UK housing market continues to show ongoing weakness with no signs of an active recovery. According to the July Royal Institution of Chartered Surveyors survey, key activity metrics remain deep in negative territory, with new buyer enquiries holding at a net balance of -28% and agreed sales at -0.30%. House prices also remain subdued with a net balance of -30%. Industry experts attribute this persistent stagnation primarily to elevated mortgage finance costs, ongoing domestic policy uncertainty, and geopolitical tensions.
Lion Finance Group is a leading UK-listed financial services group providing extensive retail banking, corporate banking and wealth management operations primarily across the Georgian and Armenian markets. Last week, the company's stock surged 8.60%, closing at 13,510p on 14 August 2026. This strong performance was primarily driven by a highly positive second quarter (“Q2”) and first half 2026 earnings report, where investors cheered a 23% year-over-year surge in Q2 pretax profit and robust expansion in its loan book and client deposits. The rally was supported by management's aggressive return of capital to shareholders, including a 16% increase in the first-half dividend and an extension to its ongoing share buyback program.
Computacenter provides information technology infrastructure services, including technology sourcing, cloud solutions and managed services to corporate and public sector organisations across Europe and North America. Last week, the company's stock rose 3.77%, closing at 5,010p on 14 August 2026. This positive weekly performance was primarily driven by the ongoing digestion of the company's stellar July trading update and the broader market momentum surrounding artificial intelligence infrastructure. The massive product-order backlog and robust demand reflected the company's strong long-term prospects.
Antofagasta, a London-listed pure-play copper producer widely recognised for operating major mining assets in Chile, experienced a significant market setback when its stock price dropped 9.95% over the week to close at 3,585p on 14 August 2026. This notable decline was directly triggered by the release of the company's first half (“H1”) 2026 financial results, which rattled investors and shifted focus away from its otherwise record-breaking financial gains. The sharp sell-off was primarily driven by a concerning 9.5% decline in first-half copper production, which dropped to 285,000 tonnes, prompting the company to cut its full-year output guidance.
Market Commentary prepared by Walker Crips Investment Management Limited.
This publication is intended to be Walker Crips Investment Management's own commentary on markets. It is not investment research and should not be construed as an offer or solicitation to buy, sell or trade in any of the investments, sectors or asset classes mentioned. The value of any investment and the income arising from it is not guaranteed and can fall as well as rise, so that you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Movements in exchange rates can have an adverse effect on the value, price or income of any non-sterling denominated investment. Nothing in this document constitutes advice to undertake a transaction, and if you require professional advice you should contact your financial adviser or your usual contact at Walker Crips. Walker Crips Investment Management Limited is authorised and regulated by the Financial Conduct Authority (FRN:226344) and is a member of the London Stock Exchange. Registered office: 128 Queen Victoria Street, London, EC4V 4BJ. Registered in England and Wales number 4774117.
Important Note
No news or research content is a recommendation to deal. It is important to remember that the value of investments and the income from them can go down as well as up, so you could get back less than you invest. If you have any doubts about the suitability of any investment for your circumstances, you should contact your financial advisor.
The value of investments can fall as well as rise. Investors may get back less than invested. Past performance is not a reliable indicator of future results.
The value of investments can fall as well as rise. Investors may get back less than invested.
