London pre-open: Stocks to fall ahead of US inflation reading
By Michele Maatouk
Date: Wednesday 12 Aug 2026
(Sharecast News) - London stocks were set to fall at the open on Wednesday amid conflicting messages about a potential US-Iran agreement to reopen the Strait of Hormuz and as investors eyed a key US inflation reading.
The FTSE 100 was called to open around 21 points lower.
Summing up the latest Middle East developments and their impact on oil prices, Danske Bank said: "Brent crude yesterday briefly climbed above USD 90/bbl before reversing course, as headlines from Pakistan suggested the US and Iran may be close to some form of deal. On the news, Brent crude fell back to around USD 87/bbl.
"However, overnight fresh attacks on shipping renewed concerns over regional escalation. Reports of a suspected Houthi attack in the Bab el-Mandeb Strait and a US strike on a vessel in the Gulf of Oman have added to uncertainty causing Brent crude to climb back towards USD 90/bbl. Although deal optimism is fading, any renewed diplomatic progress could quickly pull attention back towards last week's low near USD 80/bbl."
Looking ahead to the rest of the day, the US consumer price index for July will be the highlight at 1330 BST.
Kathleen Brooks, research director at XTB, said the market is expecting a small moderation in both headline and core US CPI for July. The headline rate is expected to come in at 3.4%, while the core rate is expected to moderate a notch to 2.5%.
Patrick Munnelly at Tickmill Group said CPI now carries more weight than payrolls. "A soft inflation print could restore the post-jobs rally in bonds," he said. "A firm print, especially with higher gasoline prices feeding expectations, would validate the hawks."
In corporate news, infrastructure construction group Balfour Beatty said its full‑year performance is now expected to be slightly ahead of prior guidance, with the company forecasting low double‑digit profit from operations growth from its earnings‑based businesses and pointing to a £22.9bn order book and strong growth markets underpinning a positive outlook.
Balfour posted a jump in first-half underlying profit to £139m from £95m driven by rising demand in the UK and US.
Infrastructure solutions specialist Hill & Smith posted a "strong" first‑half performance, underpinned by double‑digit organic growth in its US operations, prompting the group to lift full‑year expectations.
Underlying revenues increased 8% to $606.7m, and underlying operating profit also rose 8%, to $102.9m. Statutory operating profits, on the other hand, fell 13% to $76.5m, while statutory pre-tax profits declined 16% to $69.2m. Underlying earnings per share grew 9% to USD 90.6 cents. Hill & Smith reported 5% organic constant‑currency revenue growth, with robust US demand offsetting weaker trading in UK Engineered Solutions.
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