FTSE 100 shares round-up: Barclays, Rolls-Royce and 3i in demand

Barclays (LSE:BARC), Games Workshop Group (LSE:GAW) and Rolls-Royce Holdings (LSE:RR.) today continued their momentum in a session when FTSE 100 strugglers 3i Group Ord (LSE:III), Barratt Redrow (LSE:BTRW) and Persimmon (LSE:PSN) also received support.

The wider blue-chip benchmark drifted in line with European markets, with telcos Vodafone Group (LSE:VOD) and BT Group (LSE:BT.A) and the utilities National Grid (LSE:NG.) and Centrica (LSE:CNA) among those under pressure.

However, there were pockets of cheer as the relief rally sparked by the proposed Middle East peace deal was accompanied by a softer-than-expected UK inflation reading of 2.8%.

The print boosted bargain hunting interest in housebuilders Barratt Redrow and Persimmon, although the pair are still almost 30% cheaper than their levels prior to the Iran war.

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Cost pressures and affordability fears after the average mortgage rate recorded by Moneyfacts rose from 4.89% at the start of March to yesterday’s 5.54% have weighed heavily.

The recent pressure will mean Berkeley Group Holdings (The) (LSE:BKG) starts next week outside the FTSE 100 for the first time since September 2017, having recently slumped to an eight-year low.

Today’s inflation figure has reinforced expectations that the Bank of England will make no change to policy at its meeting tomorrow and possibly keep rates on hold for the rest of 2026.

The potential boost to consumer spending power lifted Howden Joinery Group (LSE:HWDN) shares to their highest level since April, while B&Q and Screwfix owner Kingfisher (LSE:KGF) also advanced.

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NatWest Group (LSE:NWG) and Lloyds Banking Group (LSE:LLOY) rose to 635.8p and 105.6p respectively as the improved demand outlook compensated for the possible loss of a margin-boosting interest rate hike.

A much bigger share price gain was posted by Barclays, which rallied 15.65p to the top of the FTSE 100 at 502.6p after Bank of America upped its price target by 30p to 600p.

The bank said Barclays was “in the right postcodes” thanks to strong UK lending growth, as well its capital markets exposure on Wall Street and strong consumer trends elsewhere in the US.

It added: “This not only presents upside potential to earnings, but the higher capital generation could also support higher buybacks, which at current valuations remain attractive.”

The bank lifted its previous forecast for 2026-2028 compound earnings per share growth of about 20% to the region of 22%, which would be among the highest in the sector.

Barclays shares were the second most traded by volume in the FTSE 100 at noon, with Rolls-Royce dealings also placing the engines maker in the top ten.

Its shares rose another 20.4p to 1413.4p, having set a record 1,424p early in today’s session. They are up by about 30% since late April, boosted in recent days by the improved outlook for engine flying hours and further progress with its nuclear reactor ambitions.

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This week’s contract with Sweden’s Vattenfall means that Rolls has been successful in every competitively tendered small modular reactor (SMR) selection process in Europe.

Games Workshop lifted by another 200p to 20,540p, which compares with last week’s level of 18,900p and represents a market capitalisation of £6.8 billion.

The latest rise came as the Warhammer hobby firm declared a dividend of 90p a share for payment on 7 August, up from the 85p seen at the same stage of the last financial year.

As the company only makes payments out of “truly surplus capital”, the announcement gave another positive insight into the outlook at the start of the 2026/27 financial year.

It has already disclosed that annual results on 28 July will show revenues for the 2025/26 year of not less than £625 million, up from £565 million the year before. Pre-tax profit will be at least £265 million, compared with £262.8 million in 2024/25.

The shares have surged by a fifth since February but are still short of the price targets of City firms Peel Hunt and Jefferies at 22,000p and 21,850p respectively.

Elsewhere on the FTSE 100 risers board, the shares of private equity group 3i Group got a much-needed boost after their fall from 3,450p earlier this year to last month’s 2,100p and today’s 2,352p.

The stock has been one of the hardest hit by the Iran war as a slowdown in like-for-like sales growth at European discount chain Action has fuelled City concerns about 3i’s reliance on an asset that accounts for 70% of its portfolio.

A short update is expected at 3i’s AGM next week before a more detailed assessment of Action’s trading performance at a first quarter update on 23 July.

UBS thinks Action trends improved in May but warns that 3i's portfolio update at the end of September and interim results in November will be the earliest dates at which 3i can provide evidence of this to the market.

The bank, which has a price target of 2,700p, said: “We expect 2026/27 to be a trough year for 3i and Action, before recovery. We reiterate our Buy rating, but do not expect the Q1 results to be a positive catalyst.”