The FTSE 100 moved lower on Wednesday as escalating geopolitical tensions overshadowed a series of positive corporate updates. Reports that Donald Trump is considering a prolonged economic blockade of Iran unsettled investors, signalling a shift toward sustained pressure rather than immediate military escalation.
By 07:58 GMT, the FTSE 100 had declined 0.6%, while the pound weakened against the dollar to 1.3505. European markets also edged lower, with the DAX down 0.2% and the CAC 40 falling 0.4%.
Market sentiment has been further impacted by stalled negotiations between the U.S. and Iran over Tehran’s nuclear programme, following a fragile ceasefire that has yet to evolve into a broader agreement. A key concern remains the continued disruption in the Strait of Hormuz, a critical passage for global energy supplies that typically handles around 20% of the world’s oil shipments. Iran has indicated it may maintain restrictions on the route in response to U.S. actions, heightening fears of prolonged supply constraints.
Additional uncertainty has emerged after the United Arab Emirates signalled its exit from OPEC, potentially weakening coordination among oil producers and raising the risk of unaligned production decisions once shipping normalises. Together, these developments have kept oil prices elevated and increased concerns around inflation, tighter financial conditions, and slower global economic growth.
UK Roundup
Lloyds Banking Group plc (LSE:LLOY) reported first-quarter pre-tax profit of £2 billion, exceeding expectations on the back of stronger lending income. The bank also flagged risks linked to the Iran situation, taking a £151 million charge while maintaining its 2026 profit outlook.
Aston Martin Lagonda Global Holdings plc (LSE:ASL) posted a narrower first-quarter operating loss of £56.9 million and secured £50 million in new funding from its core investor group. It reaffirmed full-year guidance but warned that instability in the Middle East could affect regional demand.
Haleon plc (LSE:HLN) reported organic revenue growth of 2.2%, slightly missing expectations due to weaker international performance. The company maintained its full-year guidance, anticipating stronger contributions from North America.
Jet2 plc (LSE:JET2) said summer bookings are up 7.7% year on year, reflecting resilient demand for travel. However, it noted that geopolitical uncertainty linked to Iran could affect peak-season occupancy, although fuel costs remain largely hedged.
AstraZeneca plc (LSE:AZN) exceeded expectations in the first quarter, reporting earnings per share of $2.58 and an 8% increase in revenue to $15.29 billion, driven by strong demand for cancer treatments. The company maintained its full-year outlook.
GSK plc (LSE:GSK) also delivered better-than-expected first-quarter results, supported by strong sales in respiratory and general medicines, outperforming analyst forecasts on both revenue and profit.
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