Author: Fiona Craig

European equity markets traded modestly higher on Wednesday as investors positioned themselves ahead of a busy schedule of central bank policy announcements, with softer inflation data providing particular support to UK stocks.

By 08:05 GMT, Germany’s DAX had gained 0.2%, France’s CAC 40 was up 0.2%, and the UK’s FTSE 100 outperformed with a rise of 0.8%.

Focus shifts to central bank meetings

Market attention this week is firmly centred on upcoming monetary policy decisions across Europe, as investors look for clarity on the direction of interest rates heading into the new year.

The European Central Bank is widely expected to keep its key interest rate unchanged at 2% when it meets on Thursday. Recent economic indicators suggest the eurozone economy has shown greater resilience than initially anticipated.

Despite pressure from U.S. President Donald Trump’s aggressive trade stance, the 20-country euro area has managed to absorb some of the impact of higher U.S. tariffs, partially offsetting weaker export performance. However, momentum has softened toward year-end, with manufacturing activity contracting further and growth in the services sector losing pace.

Later in the session, November eurozone CPI data is due for release, though it is not expected to materially affect ECB policy decisions.

Meanwhile, Sweden’s Riksbank and Norway’s Norges Bank are also set to announce their final policy decisions of 2025 this week. In the UK, inflation data published earlier in the day is likely to influence the Bank of England’s next move.

Annual UK consumer price inflation slowed to 3.2% in November from 3.6% in October, marking its lowest level in eight months. On a monthly basis, prices declined by 0.2%. The BoE narrowly voted 5–4 to keep rates unchanged last month, but easing inflation could increase the likelihood of a rate cut to 3.75% from 4%, which would be the lowest level since early February 2023.

Corporate updates in focus

On the corporate front, Thyssenkrupp Nucera (TG:NCH2) reported fourth-quarter results broadly in line with its November pre-release, with revenue slightly ahead of consensus expectations and earnings largely unchanged.

Serco (LSE:SRP) lifted its profit guidance for 2025 and delivered a constructive outlook for 2026, supported by strong trading across its government services operations.

Bunzl (LSE:BNZL) also updated the market, confirming that its adjusted operating profit for 2025 remains in line with expectations, despite persistent economic pressures in several key markets.

Oil prices jump after Venezuela announcement

Crude oil prices climbed sharply on Wednesday after President Trump ordered a total blockade of all sanctioned oil tankers entering and leaving Venezuela, raising concerns over potential supply disruptions.

Brent crude futures rose 1.4% to $59.73 per barrel, while U.S. West Texas Intermediate futures gained 1.5% to $55.94 per barrel.

Both benchmarks had fallen to five-year lows in the previous session, following reports of tentative progress in Russia-Ukraine peace negotiations and mounting worries about excess supply next year.

“Venezuela exported around 600k b/d of oil in November. It’s likely that these volumes will fall given the latest developments. The bulk of this oil is shipped to China,” ING analysts said in a note.

Serco Group (LSE:SRP) shares climbed 4.9% on Wednesday after the government services provider lifted its profit outlook for 2025 and issued a stronger-than-expected forecast for 2026. The upgrade reflects solid contract delivery and continued efficiency gains across the business.

The company now expects underlying operating profit of around £270 million in 2025, an increase from its previous £260 million guidance, despite adverse currency impacts of roughly £6 million. Revenue is forecast to reach £4.9 billion, representing 3% growth on a constant-currency basis, including 1% organic growth.

Free cash flow expectations were also raised sharply, with guidance increased to £170 million from £130 million previously.

“The Group has demonstrated significant strategic and operational progress throughout the year, as we continue our focus on operational excellence, competitiveness and sustainable growth,” said Anthony Kirby, Serco Group Chief Executive. “I am pleased with the strong performance across financial and non-financial metrics, reflecting the hard work and dedication of all my colleagues around the world.”

Looking ahead to 2026, Serco expects revenue to rise to approximately £5.0 billion, supported by improved organic growth of around 3%, largely driven by defence-related contracts. Underlying operating profit is projected to reach about £300 million, delivering a margin of roughly 6.0%, which sits at the upper end of the company’s medium-term target range.

Order intake for 2025 is expected to remain strong at around £5.5 billion, implying a book-to-bill ratio of at least 110%. Around two-thirds of contract awards were secured within the defence sector, with a particular focus on the UK and North American markets. The company also reported that its pipeline has reached a new decade-high level, reflecting sustained demand for outsourced government services.

Serco additionally confirmed that Mark Reid will take over as Group Chief Financial Officer on 6 March 2026, replacing Nigel Crossley, who will retire after 11 years with the group.

The balance sheet remains robust, with adjusted net debt expected to be approximately £265 million at the end of 2025. This equates to leverage of around 0.9 times net debt to EBITDA, comfortably below the company’s medium-term target range of 1–2 times.

Diageo Plc (LSE:DGE) has reached an agreement to sell its controlling interest in East African Breweries Ltd. to Japan’s Asahi Group Holdings Ltd. for $2.3 billion, as the drinks group continues to streamline its portfolio and focus on core growth areas.

The transaction covers Diageo’s 65% holding in East African Breweries as well as its majority interest in UDVK, a Kenyan-based spirits producer and importer. East African Breweries already owns the remaining share of UDVK and retains operational control of the business.

The sale forms part of Diageo’s broader strategy to scale back its exposure to African markets. In recent years, the company has exited several regional assets, including the full disposal of Seychelles Breweries Ltd. and its Nigerian operations.

Earlier this year, Diageo completed the sale of its 80% stake in Guinness Ghana Breweries Ltd. to Castel Group. The group has also divested Guinness Cameroon SA and Ethiopia’s Meta Abo Brewery, further reshaping its African footprint.

UK equities moved higher in early trading on Wednesday after fresh data showed a slowdown in inflation, while sterling slipped against the US dollar following a strong performance in the previous session. European markets also traded mostly higher, adding to the positive tone.

By 0825 GMT, the FTSE 100 was up around 1%, while the pound had fallen 0.7% against the dollar to 1.33. Elsewhere in Europe, Germany’s DAX rose 0.2% and France’s CAC 40 edged 0.05% higher.

UK inflation falls to eight-month low

Data released earlier showed the annual UK inflation rate eased to 3.2% in November from 3.6% in October, marking its lowest reading in eight months. The decline could give the Bank of England additional flexibility ahead of its final policy decision of the year.

On a monthly basis, inflation fell by 0.2%, reversing the 0.4% increase seen in October. Core inflation, which strips out energy and food prices, also slowed to 3.2% year-on-year from 3.4%, while monthly core CPI declined by 0.2%.

Despite the improvement, inflation remains above the Bank of England’s 2% target. However, the continued downward trend indicates progress in reducing price pressures across the economy.

Bunzl flags steady FY25, cautious outlook for FY26

Bunzl PLC (LSE:BNZL) issued a trading update confirming that its FY25 revenue and operating margin remain in line with previous guidance and market expectations.

The group reported “good momentum” in the fourth quarter, supported by new contract wins in North America. Bunzl expects FY25 revenue growth of 2–3% on a constant currency basis, with reported revenue broadly flat. Adjusted operating profit is forecast to be “in-line with expectations,” delivering a margin of 7.6%, while leverage is expected to be around 2x by year-end.

Looking ahead, the company said FY26 should deliver “moderate revenue growth excluding foreign exchange effects,” supported by modest organic growth and a limited contribution from acquisitions.

Serco upgrades profit outlook

Serco Group (LSE:SRP) raised its profit guidance for 2025 and outlined upbeat targets for 2026, citing strong trading across its operations.

The outsourcing specialist now expects underlying operating profit (EBITA) of £270 million for 2025, up from prior guidance of £260 million and around 3% above analyst expectations. Organic revenue growth guidance was maintained at 1%, with total revenue forecast at £4.9 billion.

Games Workshop declares new dividend

Games Workshop Group PLC (LSE:GAW) announced a dividend of 50 pence per share, taking total distributions for the year to 375 pence.

The payout represents an increase of more than 40% compared with the same point last year, when dividends totalled 265 pence per share.

IntegraFin beats expectations, targets margin gains

IntegraFin Holdings PLC (LSE:IHP) reported FY25 underlying profit before tax of £75.4 million, beating consensus estimates by 1.7% and rising 7% year-on-year.

Earnings per share came in at 17.4p, 3% ahead of forecasts, while the dividend was increased by 9% to 11.3p. Following a detailed cost review, the company outlined plans to improve operating efficiency, targeting administrative cost growth of just 3% in FY26 and FY27, compared with market expectations of 4–5% and after 9% growth in FY25.

Synectics plc (LSE:SNX) has reported a robust performance for FY2025, with revenue expected to reach around £68 million, supported by the award of a major gaming contract in South-East Asia. The result reflects solid execution across the business and provides a strong foundation for the next phase of growth.

The company is progressing with a strategic transformation, moving away from a predominantly bespoke, project-based approach toward a scalable, product-led software platform. This shift is intended to drive more predictable, sustainable growth while enabling diversification into adjacent markets such as renewables and decarbonisation. A healthy order book and strong cash position are supporting continued investment in these strategic priorities.

Synectics’ outlook is underpinned by its financial strength, positive corporate developments and expanding contract base. While technical indicators offer mixed short-term signals, valuation metrics suggest potential upside. Overall, the company appears well placed within the security and protection services sector to deliver long-term value for stakeholders.

More about Synectics

Synectics plc is a provider of advanced security and surveillance solutions, delivering integrated systems that enhance safety, operational efficiency and decision-making. The company combines technical expertise with long-standing partnerships to protect people, property and assets across a range of global markets.

Avacta Group PLC (LSE:AVCT) has announced positive Phase 1b clinical results for faridoxorubicin (AVA6000) in patients with salivary gland cancer. Across the Phase 1a and 1b studies, the treatment achieved a 90% disease control rate, with data indicating meaningful tumour reduction and extended progression-free survival.

The findings support the potential of Avacta’s pre|CISION® platform to deliver targeted cancer therapies by activating potent drugs directly within the tumour environment. The company believes the results highlight an opportunity to address unmet medical needs in salivary gland cancer and potentially other solid tumours, with additional trial data expected in the first half of 2026.

Despite the encouraging clinical progress and supportive technical indicators, Avacta’s broader outlook remains constrained by financial pressures. Ongoing losses, valuation concerns and reliance on external funding continue to weigh on the investment case, even as corporate developments point to longer-term potential.

More about Avacta Group plc

Avacta Therapeutics is a clinical-stage biopharmaceutical company developing targeted oncology therapies using its proprietary pre|CISION® platform. The technology is designed to selectively activate highly potent treatments within tumour tissue, limiting damage to healthy cells. Avacta’s pipeline includes pre|CISION® peptide drug conjugates and Affimer®-based therapies, offering an alternative approach to traditional antibody-drug conjugates.

Jubilee Metals Group (LSE:JLP) has released its audited results for the year ended 30 June 2025, outlining continued progress in its copper-led growth strategy in Zambia. The company reported a 65.5% increase in copper output in the first quarter of FY2026, reflecting the momentum generated by its Three-Pillar Strategy.

As part of its portfolio realignment, Jubilee is progressing with the planned disposal of its chrome and PGM operations in South Africa, with completion targeted for December 2025. The transaction is expected to release capital to support further investment in its Zambian copper operations. During the period, the group also completed sales of copper-bearing materials and waste assets, with related revenues set to be recognised in the current financial year.

Strategic investments and partnerships are anticipated to strengthen operational performance and enhance Jubilee’s position within the copper market. While the Zambian strategy offers substantial growth potential and efficiency gains, the outlook is tempered by financial pressures including tighter margins and higher leverage. Recent corporate actions provide strategic support, although technical indicators point to a cautious near-term trading environment.

More about Jubilee Metals Group

Jubilee Metals Group PLC is focused on copper production and processing in Zambia. The company operates an integrated mine-to-metals business, processing third-party copper feedstock alongside surface stockpiles and tailings. Jubilee is transitioning toward a pure-play copper producer, leveraging its Zambian assets to drive long-term growth.

Victoria PLC (LSE:VCP) has reported a resilient performance for the first half of the year, navigating challenging macroeconomic conditions and subdued consumer demand. The group delivered notable margin expansion and increased underlying EBITDA to £53.5 million, reflecting the impact of disciplined cost control and targeted efficiency initiatives.

Although revenue declined by 7% year-on-year, trading momentum showed signs of improvement, with management expecting volumes to recover as market conditions stabilise. Work to restructure the Rugs division and refinance the balance sheet remains ongoing, with a continued focus on driving EBITDA improvements and restoring the company’s credit profile.

Despite some supportive corporate developments, Victoria’s overall outlook continues to be constrained by weak financial metrics and bearish technical signals. Ongoing profitability challenges and unfavourable valuation indicators weigh on the investment case, limiting near-term upside.

More about Victoria

Founded in 1895, Victoria PLC is an international manufacturer and distributor of flooring products, listed on the London Stock Exchange since 1963. Headquartered in Worcester, the company produces a wide range of carpets, underlay, ceramic tiles, luxury vinyl tiles, artificial grass and related accessories. Victoria operates across Europe, the United States and Australia, employing over 5,000 people at more than 30 sites, and is Europe’s largest carpet manufacturer and the second largest in Australia.

Springfield Properties PLC (LSE:SPR) has reached an initial agreement with SSEN Transmission to develop around 300 new homes in the north of Scotland, supporting planned upgrades to regional energy infrastructure. The arrangement represents a key step in Springfield’s strategy to align housing delivery with major infrastructure investment, creating longer-term value for both local communities and the business.

The company also reported that trading in the first half of 2026 was in line with management expectations. During the period, Springfield achieved a meaningful reduction in net bank debt, supported by strong performance within its affordable housing segment. Looking ahead, the group expects improving consumer confidence and a more supportive housing market environment in the second half of the year, underpinning its revenue growth ambitions.

Springfield’s outlook is supported by solid financial execution, positive technical indicators and an attractive valuation profile. Its strategic focus on northern Scotland and recent corporate developments further strengthen its growth prospects. However, the decline in free cash flow growth remains an area of focus as the company looks to sustain long-term expansion.

More about Springfield Properties PLC

Springfield Properties PLC is one of Scotland’s leading housebuilders, delivering both private and affordable homes across the country. The company focuses on high-quality residential developments designed to meet the needs of a broad customer base, spanning private purchasers and affordable housing providers.

Bunzl plc (LSE:BNZL) has confirmed that profit expectations for 2025 remain in line with previous guidance, even as macroeconomic headwinds continue to affect global markets. The group expects revenue to grow by around 2% to 3% at constant exchange rates, supported primarily by acquisitions, while operating margins are forecast to remain broadly stable.

During the year, Bunzl completed the acquisition of Damito s.r.o in Slovakia, extending its footprint in Eastern Europe. Looking ahead to 2026, management is guiding for moderate revenue growth alongside a modest decline in operating margin, as the company continues to focus on performance improvements and the capture of new commercial opportunities.

Bunzl’s overall outlook is underpinned by resilient financial performance and positive corporate actions, including ongoing share buybacks and disciplined acquisition activity. However, technical indicators currently point to a bearish share price trend, and mixed sentiment from recent earnings commentary suggests a degree of caution. Valuation remains reasonable, supported by an attractive dividend yield.

More about Bunzl plc

Bunzl plc is a global distribution and services group supplying essential products such as cleaning and hygiene solutions, personal protective equipment and packaging materials. The company operates across a wide range of end markets, with a strong presence in North America and Europe, and continues to expand internationally through targeted acquisitions.