FTSE Indices React to Inflation Data Despite Sage Success

The UK's FTSE 100 dipped due to rising inflation dampening hopes for interest rate cuts, overshadowing Sage's impressive profits. The domestically focused FTSE 250 also fell as inflation surpassed the Bank of England's 2% target. Investors anticipate Nvidia's quarterly report amid real estate sector losses.

On Wednesday, the UK's FTSE 100 share index saw a decline as hotter-than-anticipated inflation figures cooled expectations for rapid interest rate cuts. This development overshadowed the positive sentiment surrounding software company Sage's promising quarterly profits.

Despite the FTSE 100 closing down 0.2%, the technology sector index surged by 6.2% to reach a record high. Sage Group reported an impressive 21% increase in operating profit, driven by a 220-basis-point margin rise, predicting further growth this year, which buoyed its shares by 18% to an all-time high.

The FTSE 250 index, focused on domestic markets, dropped 0.9% to its lowest in over three months. This drop was linked to inflation exceeding forecasts in October, surpassing the Bank of England's 2% threshold, mainly due to domestic energy tariff hikes. These figures have led traders to anticipate a cautious approach from the BoE, expecting just over a 60-basis-point rate cut by year's end.

(With inputs from agencies.)