The FTSE surged to new levels as strong airline results, corporate restructuring and notable deal activity supported investor optimism
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London markets advanced on Tuesday as the FTSE 100 reached new highs, driven by a mix of corporate news and broader risk sentiment. Investors reacted to a strong performance from IAG, owner of British Airways and Iberia, tempered by mixed updates from recruitment group Hays and a strategic sale announced by hobby group Hornby.
At the same time, shifts in consumer confidence data and movements in US technology stocks continued to shape appetite for risk.
These developments illustrate how company results, corporate actions and macroeconomic indicators jointly influence market direction. The paragraphs below summarise the most significant corporate reports and market reactions and identify themes likely to matter to investors in the near term.
Corporate results and key business moves
Iag posts higher operating profit and signals upbeat 2026 outlook
Following corporate results that helped lift the FTSE 100, IAG reported an annual operating profit for 2026 of €5 billion, a rise of 13.1% year on year.
Revenue grew 3.5% to €33.2 billion, and the operating margin increased to 15.1%, ahead of several peers.
Management described the performance as world-class and pointed to what it called compelling market dynamics as the basis for an optimistic outlook for 2026. The group highlighted its near-50% market share on North Atlantic services alongside partners, underscoring its scale on transatlantic routes.
IAG announced shareholder returns that include a final dividend of 5 euro cents per share and plans for $1.5 billion of buybacks over the next 12 months. Management framed the buyback programme as a use of excess capital consistent with its financial priorities.
The results and planned returns follow a period of stronger travel demand and continued capacity recovery across international routes. Investors will watch how capacity, fuel costs and pricing trends affect margins in the coming quarters.
Hays returns to profit in uk and ireland despite group weakness
Investors watching how capacity, fuel costs and pricing trends affect margins will also note mixed signals from the recruitment sector. Recruitment specialist Hays reported a return to profit in its UK and Ireland arm for the six months to 31 December, posting a £2 million surplus after a prior-year loss.
At group level, results were weaker. Net fees fell 9% and headline profits dropped sharply across Hays’s largest markets. Profits in Germany declined by 25% to £20.6 million. Group operating profit fell 29% to £13.4 million.
The company cut its interim dividend by 84% to 0.15p per share. It also announced an immediate leadership change. Dirk Hahn stepped down as chief executive for personal reasons. Mark Dearnley will serve as interim chief executive.
Hays said it expects improvements in client and candidate sentiment to feed through to earnings when the cycle turns. The group did not provide further timing guidance in the results statement.
Hornby sells iconic brand and reinvests
A separate update on Hornby follows in the next section.
Hornby has agreed to sell the Scalextric slot-car business for up to £20 million. The buyer is Scalextric Motorsports, a company established by Purbeck Capital Partners chief executive Mark Brown. Hornby said the disposal will allow it to reduce debt and focus on core brands such as Airfix. The group described the move as part of an effort to pursue balance sheet repair and concentrate management resources on core operations. The buyer said the acquisition presents an opportunity to revitalise a multi-generational toy brand and to expand into motorsport-related activities.
Market reaction and broader indicators
Investor reaction to the sale was cautious. Market commentary noted the transaction eases Hornby’s immediate liquidity pressures without resolving longer-term structural challenges. Analysts described the deal as a pragmatic step to shore up the balance sheet while management pursues operational recovery.
The disposal also adds context to other signals from the wider market. Recent corporate updates have highlighted mixed trading conditions and pressure on margins across consumer and services sectors. Observers said the Hornby sale is consistent with a broader pattern of companies divesting non-core assets to strengthen finances and preserve capital for core brands.
Hornby said it will provide further timing guidance in its forthcoming results statement. Investors will watch the group’s subsequent cash flow and margin trends for evidence that the sale delivers the intended financial relief and supports the planned reinvestment in core operations.
The FTSE 100 opened at record levels and extended gains amid positive corporate earnings and selective sector rebounds. Banks and miners underpinned the advance. Several consumer-facing names weighed on the index after dividend adjustments and softer trading updates.
Across the Atlantic, major US technology stocks showed renewed volatility as investors digested earnings and guidance from large tech groups. Major US indices moved unevenly, reflecting mixed signals from earnings and analyst commentary.
On the macro side, GfK’s long-running consumer confidence index fell by three points to -19 in February, with households reporting weaker views of past and future finances despite softer inflation. That deterioration presents a headwind for retailers and high-ticket categories even as other factors continue to support equities.
Commodity and energy prices were broadly steady, which helped to calm input-cost pressures for some cyclical companies. Stable commodity markets may relieve short-term margin pressure for manufacturers and miners.
What to watch next
Corporate earnings and updated guidance from large UK and US companies. Those reports will drive near-term market direction and investor sentiment.
Retail sales and consumer spending indicators. Continued weakness in household sentiment could translate into softer demand for discretionary and high-ticket items.
Developments related to Hornby’s disposal of the Scalextric business and the group’s cash flow and margin trends. Monitoring execution will show whether the sale delivers the intended financial relief and funds planned reinvestment in core operations.
Commodity and energy price movements. Renewed volatility in input costs would change margin expectations for cyclical sectors and affect earnings forecasts.
Monetary- and fiscal-policy signals from major economies. Any shift in policy tone could alter risk appetite and capital flows into UK equities.
What investors will watch next
Investors will monitor whether strong corporate margins at companies such as IAG and the defensive appeal of mining and banking can sustain the rally. Markets will also track consumer spending indicators and corporate dividend policies. Those factors are shaping both equity valuations and income expectations.
Management changes and asset disposals at firms including Hays and Hornby are adding another layer of uncertainty. Such corporate actions can alter outlooks beyond headline earnings. Analysts say strategic disposals and board shifts can meaningfully change cash flows and investor sentiment.
How this could affect the ftse 100
The recent advance reflects solid company-level results, selective sector rotation and strategic portfolio moves. Some firms are increasing payouts while others are retrenching. Household caution is visible in spending signals.
That interplay will influence whether the FTSE 100 maintains its record momentum. Any shift in policy tone could alter risk appetite and capital flows into UK equities. Market participants will therefore watch upcoming corporate updates and consumer data for signs of persistence or reversal.
