UK Stock Market Today: FTSE 100 Poised for Softer Open as Fed Jitters Meet Weak UK Spending (9 December 2025)

As the London Stock Exchange prepares to open at 8:00 a.m. local time, UK investors face a cautious global backdrop, soft domestic data and a busy slate of stock‑specific news. ^[1]

Here’s what you need to know before the UK stock market opens today, Tuesday 9 December 2025.

1. Market set‑up: FTSE 100 futures hint at a slightly lower open

Overnight futures indicate a subdued start in London. A Reuters “factors to watch” note suggests the FTSE 100 is called marginally lower, with futures down around 0.02%, pointing to a flat‑to‑slightly‑negative open. ^[2]

That follows a soft Monday session:

FTSE 100 closed down about 0.2%.
FTSE 250 underperformed, falling around 0.7%.
Housebuilders led decliners, with the sector index dropping over 3%.
Unilever slipped roughly 2% as the long‑trailed Magnum ice cream spin‑off completed its Amsterdam debut.
Infrastructure fund SDCL Efficiency Income Trust sank more than 16% after breaching its leverage limits, a reminder of how rising rates have stressed income vehicles. ^[3]

With global markets in “wait and see” mode ahead of the US Federal Reserve’s decision this week, there’s little sign of a major rebound at the open in London.

2. Global backdrop: Fed anxiety and cautious risk sentiment

The tone for the UK stock market today is being set overseas.

Wall Street: minor pullback from record highs

US equities retreated modestly on Monday:

The S&P 500 slipped around 0.3%,
The Dow Jones fell roughly 0.4%, and
The Nasdaq edged lower by about 0.1%,
after flirting with record levels. ^[4]

Investors are almost certain the Federal Reserve will cut rates by 25 basis points this week, but there is growing unease about how far and how fast cuts will go in 2026. A global markets wrap notes that MSCI’s world equity index is down about 0.1%, Asian stocks are off roughly 0.5%, and US 10‑year Treasury yields are holding near 4.18% as traders brace for a potentially “hawkish” tone from the Fed. ^[5]

Asia: mostly red, tracking Wall Street lower

Overnight in Asia:

Japan’s Nikkei managed a small gain of around 0.2%,
Hong Kong’s Hang Seng lost close to 1%,
Shanghai dipped, and
South Korea, Taiwan and Australia also traded lower. ^[6]

A separate Reuters recap describes Asian and European markets as subdued, with investors “nervy” ahead of the Fed verdict and 2026 rate guidance. ^[7]

Commodities and FX: oil soft, dollar steady

Oil: Brent is trading near $62.4 and WTI around $58.7 a barrel, extending Monday’s 2% slide after Iraq restored production at a key oilfield. Markets are watching Ukraine peace talks and the Fed decision, with a focus on signs of oversupply going into 2026. ^[8]
Gold is broadly steady as traders prepare for a Fed cut but brace for a cautious message on future easing. ^[9]
Currencies: The dollar index is little changed, with the euro trading around the mid‑$1.16s and the yen near ¥156 per dollar. ^[10]

Takeaway for UK investors: the global set‑up is one of consolidation, not panic. But with yields edging higher and central bank risk front‑and‑centre, any disappointment from the Fed could be felt quickly on the FTSE 100.

3. UK macro: weak spending, flat house prices and budget hangover

Consumers tightened wallets in November

Fresh data this morning show UK consumers tightened spending in November, even with Black Friday promotions:

Barclays reports card spending fell 1.1% year‑on‑year, the sharpest drop since early 2021.
The British Retail Consortium (BRC) recorded a 1.4% annual rise in retail sales, the slowest growth since May and below the typical 2.5% pace.
Retailers described Black Friday as underwhelming, blaming budget uncertainty and the cost‑of‑living squeeze. ^[11]

Stormy weather, tax jitters ahead of Chancellor Rachel Reeves’ November budget and a general squeeze on disposable income all contributed to the softness, according to several survey‑based reports. ^[12]

Housing market: stagnation, but affordability improving

The Halifax index shows UK house prices were flat in November, after a 0.5% rise in October. Annual price growth slowed to 0.7%, the weakest since March 2024, as buyers turned cautious ahead of the Autumn Budget. ^[13]

Halifax notes that affordability is at its most favourable level since 2015 and expects gradual price growth in 2026, supported by anticipated Bank of England rate cuts. ^[14]

Fund flows: budget jitters hit UK equities

Despite a strong year for UK shares, investors have been pulling money out of equity funds:

Reeves’ budget in late November triggered about £3.0 billion of equity fund outflows in a single month, one of the worst on record.
Over six months, withdrawals have totalled more than £10 billion, with UK‑focused and global equity funds both hit. ^[15]

Money has been rotating instead into money‑market and bond funds, highlighting persistent caution and policy anxiety even as indices trade near record highs.

Why it matters at the open:

Retailers such as Tesco, Sainsbury’s, Next and B&M may remain sensitive to downbeat consumer data.
Housebuilders and REITs have to balance more attractive mortgage rates with evidence of demand softness.
Longer‑term, persistent outflows from UK equity funds are a headwind for valuations, even as 2025 performance has impressed.

4. Bank of England: December cut expected, but the tone is key

What markets are pricing

The Bank of England’s next Monetary Policy Committee (MPC) decision is due on Thursday 18 December 2025. ^[16]

Financial markets currently see an 85–90% chance of a 25bp cut, taking Bank Rate from 4.0% to 3.75%. ^[17]
A Reuters poll of economists expects another cut early in 2026 as inflation cools. ^[18]

BoE policymaker Alan Taylor said yesterday that he expects inflation to fall back to the 2% target “in the near term”, noting that wage growth and services inflation have already begun to ease. He’s one of the more dovish members of the MPC and previously voted for an earlier rate cut in November. ^[19]

The balancing act for UK stocks

Banks: Lower rates could trim net interest margins, but they also ease pressure on borrowers and support credit quality.
Housebuilders and property plays: Benefit from cheaper mortgages and improved affordability; today’s Halifax data and broker calls on Berkeley (see below) add nuance. ^[20]
Sterling: A dovish surprise could weigh on the pound, supporting FTSE 100 exporters, while a “less dovish than expected” message could reverse that. ^[21]

City analysts point out the decision may be a closer call than market pricing implies, especially after Governor Andrew Bailey’s slightly more cautious recent comments. ^[22]

5. Structural backdrop: FTSE 100 strength, but narrow leadership

Despite today’s cautious tone, the FTSE 100 has had a very strong 2025:

One analysis puts the index up about 15% year‑to‑date, roughly 50% higher than five years ago. ^[23]
The index hit a record high in mid‑November, helped by a weaker pound and strong results from heavyweights such as AstraZeneca. ^[24]

However, the rally has been narrowly concentrated:

The gap between the FTSE 100 and FTSE 250 in 2025 performance is around 13 percentage points, largely driven by banks and aerospace/defence.
Research cited by the Financial Times shows banks and defence stocks account for about 12.7 points of that gap, leaving the broader market relatively muted. ^[25]

A separate deep‑dive from Franklin Templeton argues that UK equities still trade at a discount to global peers despite this outperformance and continue to be under‑owned, making them a potential “tortoise” in a world obsessed with US tech “hares”. ^[26]

Key implication for traders today: if banks or defence stocks wobble — for example on rate‑cut expectations or geopolitical news — they can move the FTSE 100 disproportionately.

6. Sector and stock stories to watch before the bell

6.1 Unilever: share consolidation and Magnum spin‑off

Unilever is back in focus this morning:

The company is implementing a share consolidation, giving shareholders 8 new shares for every 9 existing, effective 9 December 2025; ADR holders receive the same ratio. ^[27]
This follows the Magnum Ice Cream Company listing in Amsterdam, valued at around $9.1 billion. The debut was lukewarm, with the stock slipping on day one as some investors questioned the growth premium baked into the valuation. ^[28]

On Monday, Unilever’s own shares fell about 2%, weighing on the FTSE 100. ^[29]

What to monitor:

Any price adjustment from the consolidation may create short‑term “optics” volatility in the share price.
Investor reaction to Magnum’s early trading could feed back into sentiment on Unilever’s strategy and capital return plans.

6.2 Housebuilders: Berkeley upgrade and policy tailwinds

The housebuilding sector has been under pressure from higher rates and cautious buyers, but there are pockets of optimism:

Jefferies has upgraded Berkeley Group to “buy”, lifting its price target to 5,037p, implying around 34% upside from the prior close. ^[30]
The broker argues that proposed London planning reforms — including lower affordable housing requirements (from 35% to 20% in some schemes), more flexible density rules and lower fees — could significantly boost margins on Berkeley’s regeneration pipeline. ^[31]

Combined with improving mortgage affordability and expectations of BoE rate cuts, today’s note may help steady sentiment after yesterday’s sector sell‑off, even if broader macro data remain soft. ^[32]

6.3 Defence and aerospace: Chemring and FTSE concentration

The earnings calendar highlights Chemring, a defence technology group, as one of today’s notable European names alongside other mid‑caps such as CCC SA and Moonpig. ^[33]

Defence stocks have been a huge driver of FTSE 100 returns this year amid sustained European rearmament and elevated geopolitical risk. ^[34] Results or guidance surprises from Chemring could influence sentiment across the UK defence complex, including larger peers listed in London.

6.4 Income funds and infrastructure: fallout from leverage breach

Income investors should keep an eye on SDCL Efficiency Income Trust, whose shares dropped more than 16% on Monday after the trust disclosed that its debt‑to‑equity ratio had breached its investment policy limit. ^[35]

While the name is relatively small in index terms, the episode underscores broader concerns about:

leverage across real‑asset and income funds,
refinancing risk as rates remain well above the post‑financial‑crisis norm, and
the sensitivity of high‑yield vehicles to even modestly weaker growth.

6.5 Big banks: 2025 winners facing 2026 questions

A City A.M. review notes that 2025 has been a banner year for UK banks:

Lloyds is up about 76%,
Barclays has gained 65%, and
NatWest has risen 56% year‑to‑date,
helping drive a nearly 50% gain in the FTSE 350 Banks index versus around 17% for the broader FTSE 100. ^[36]

Analysts quoted in the piece say valuations are “elevated but not stretched”, with a lot now riding on:

how quickly the BoE cuts rates,
the sustainability of generous share buybacks and dividends, and
the evolving political risk around bank taxation after Reeves’ budget. ^[37]

Banks have also been beneficiaries of slowing but still positive house prices and improving mortgage availability — both of which could shift if the BoE surprises or if the economy slows more sharply. ^[38]

7. Key themes to watch at today’s UK open

Putting everything together, here are the main storylines likely to drive the FTSE 100 and broader UK market this morning:

Fed and BoE expectations
- Markets are almost certain of a Fed cut and heavily price a BoE cut next week, but the tone and 2026 path for rates remain uncertain.
- Any shift in bond yields or the dollar during today’s session could spill over into UK financials and exporters. ^[39]
Domestic demand vs. rate relief
- Weak consumer spending and flat house prices point to a fragile underlying economy, even as mortgage rates fall from last year’s peaks. ^[40]
- Rate‑sensitive sectors (retailers, homebuilders, REITs) may trade on the tug‑of‑war between softer data and the prospect of cheaper credit.
Concentration risk in the FTSE 100
- Heavy reliance on banks and defence stocks has driven the index’s outperformance versus the FTSE 250. ^[41]
- Any wobble in these sectors — perhaps on BoE policy signals or geopolitics — could have an outsized index impact.
Stock‑specific catalysts
- Unilever’s share consolidation and Magnum’s early trading,
- Berkeley’s broker upgrade and the broader housebuilder response,
- Chemring and other results on the European earnings calendar, ^[42]
  are all likely to generate individual share volatility, even if the index overall appears directionless.
Commodities and geopolitics
- Softer oil prices and fresh Ukraine peace‑talk headlines matter for UK energy majors like BP and Shell and for inflation expectations more broadly. ^[43]

8. Final word: Cautious, not catastrophic

For traders and longer‑term investors alike, the message before the UK market open on 9 December 2025 is one of caution rather than crisis:

The FTSE 100 is coming from a position of strength after a record‑setting year. ^[44]
Domestic data are soft, but policy relief from the BoE is edging closer. ^[45]
Global markets are in “holding pattern” mode ahead of the Fed, with volatility likely to rise once policymakers speak. ^[46]

As always, this overview is for information only and not investment advice. Market conditions and prices can move quickly once trading begins, so anyone placing trades today should check live data and consider their own risk tolerance and time horizon.