U.K. stocks shed ground on Thursday, weighed down by broad losses across the mining and energy sectors. Despite upbeat earnings and buoyant guidance from U.S. chip giant Nvidia, market sentiment remained decidedly cautious as investors contended with lingering geopolitical anxieties in the Middle East and uncertainty surrounding Federal Reserve interest rate policy ahead of the Jackson Hole summit.

Resource and defensive names led the market lower. Widespread selling hit LondonMetric Property, Entain, Autotrader Group, Croda International, Melrose Industries, Games Workshop, Diageo, Haleon, Rio Tinto, Lloyds Banking Group, Aviva, Coca-Cola HBC, Unilever, NatWest Group, and Vodafone Group, with shares falling between 1% and 3%. Insurer Prudential declined by about 4%, as investors reacted coolly to a slowdown in new business profit growth.

Tech and selective industrial names managed to buck the broader downturn. Computacenter rallied 4.7%, leading top-flight gainers following Nvidia's blowout results. London Stock Exchange Group (LSEG) and Polar Capital Technology Trust advanced 2.2% and 2%, respectively. Precision engineer Halma rose 1.5%, while Convatec Group, Compass Group, Airtel Africa, Whitbread, Relx, and Metlen Energy & Metals drifted higher by 1% to 1.2%.

On the economic front, domestic industrial data added to the gloomy backdrop. Figures from the Society of Motor Manufacturers and Traders (SMMT) showed UK car production slumped 10.6% year-on-year in July to 61,767 units, accelerating from a 1.3% decline in June. The sharp contraction stemmed from softer export demand and earlier-than-usual scheduling for routine summer maintenance shutdowns.

Finish Line: U.K. equities succumbed to resource-sector weakness as tech enthusiasm failed to carry the broader index. While strong semiconductor demand provided a tailwind for select IT names, falling commodity prices, insurer profit caution, and weak automotive output data kept buyers on the defensive. With central bank signals looming, the FTSE remains caught in a tight, cautious range.

TECHNICAL & TRADE VIEW – FTSE100

Daily VWAP Bearish

Weekly VWAP Bearish

Above 10700 Target 11150

Below 10400 Target 9500

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Written by Patrick Munnelly

Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!