Thursday preview: Tesco and PepsiCo results due

Across the pond, quarterly results from PepsiCo and initial jobless claims will be out.

AJ Bell analysts Dan Coatsworth, Danni Hewson and Russ Mould, said: "PepsiCo will be under pressure to find some fizz with its third-quarter results after a disappointing period which has left its shares as flat as a can of soda left open for a week.

"The big problem has been the core North American business which has delivered limited growth as the consistent price hikes rolled out in the last five years have started to have an impact on demand.

"While PepsiCo specialises in affordable treats and people are often willing to pay up for their favourite brands, the decision to slash some prices in February this year was an acknowledgement that it had gone too far, even if the international business has fared better. Having joined the shareholder register in September 2025, activist investor Elliott is now piling on the pressure to show its turnaround efforts are gaining some traction."

The analysts said investors will be looking to see if PepsiCo feels it has to take more dramatic action to cut costs or potentially even sell off assets.

"Elliott might even push for a spin-off of the underperforming beverages business - which would feel like a nuclear option," they said.

"Attention will also be paid to the trajectory of sales volumes in the third quarter as PepsiCo passed on higher input costs associated with the energy shock unleashed by the Iran conflict to its customer base, with recent events putting the company’s pricing power credentials firmly under the microscope."

Investors will also turn their attention to German trade data for August.