UK equities finished Tuesday’s session little changed, while the pound weakened against the U.S. dollar and European stock markets delivered a mixed performance.
The FTSE 100 slipped marginally by 0.03%, while sterling fell around 0.3% versus the dollar, with GBP/USD trading near 1.3430. On the continent, Germany’s DAX ended flat and France’s CAC 40 eased by 0.1%.
Arm Holdings downgraded by BofA on growth concerns
Arm Holdings is expected to see a slowdown in near-term revenue growth and increased reliance on its major shareholder SoftBank through 2026, according to analysts at BofA Securities.
The bank downgraded Arm to a “neutral” rating, citing weaker revenue prospects. Analysts pointed to softer conditions in the global smartphone market, forecasting a low single-digit annual decline in unit shipments. This trend is expected to weigh on both Arm’s licensing and royalty income streams.
Deutsche Bank cuts defence sector ratings
Deutsche Bank downgraded BAE Systems, Leonardo, and Thales, pointing to pressure on maritime margins, uncertainty around French public spending, and limited short-term upside across Europe’s aerospace and defence sector.
Shares in all three companies fell between 0.5% and 1.9%. BAE Systems was lowered to a “hold” rating, with its price target cut to 2140p from 2220p.
ING sees EUR/GBP undervalued, expects March BoE cut
The EUR/GBP exchange rate has dropped below 0.870, a level that ING models suggest is moderately undervalued in the near term. The bank continues to expect the Bank of England to deliver an interest rate cut in March, a more dovish outlook than current market pricing. This view supports ING’s expectation of a gradual recovery in EUR/GBP over the coming months.
Rentokil names new chief executive
Rentokil Initial announced the appointment of Mike Duffy as Chief Executive Officer and Executive Director, effective March 16, 2026. Duffy will join as CEO-designate in February, taking over from Andy Ransom, who will remain involved until the company’s AGM in May to ensure a smooth leadership transition.
FTSE 100 earnings highlights
SIG said its underlying operating profit for 2025 is expected to reach around £32 million, up roughly £7 million year on year. Sales were flat on a like-for-like basis, with revenue of about £2.6 billion, as restructuring and productivity initiatives supported profitability.
PageGroup reported a 4.6% decline in fourth-quarter gross profit, as weaker conditions in Europe and the UK offset growth in the Americas and Asia-Pacific.
Trustpilot forecast an 18% rise in full-year 2025 bookings to $291 million and projected annual recurring revenue of $296 million, supported by continued customer growth.
Whitbread posted a 2% increase in third-quarter group sales to £781 million, driven by stronger accommodation revenue in the UK and Germany.
Games Workshop delivered a record first half, with core revenue rising 17.3% and profit before tax increasing to £140.8 million.
Persimmon reported a 12% rise in total home completions for 2025, exceeding market expectations, although partnership completions declined amid softer demand late in the year.
THG recorded its strongest quarterly revenue growth since 2021 in the final quarter of 2025, with sales up 7% on a constant currency basis.
Gamma Communications said full-year results are expected to align with market forecasts, while Hunting reported a 7% rise in full-year EBITDA to around $135 million, supported by a stronger order book.
