UK equities traded lower on Thursday as uncertainty surrounding U.S.-Iran negotiations and a subdued response to Nvidia’s latest earnings kept investors cautious, despite oil prices recovering part of the sharp losses seen in the previous session.
The FTSE 100 fell 0.40%, while Germany’s DAX declined 0.31% and France’s CAC 40 lost 0.23%. Sterling also eased 0.12% against the dollar to 1.3419 by 07:20 GMT.
Oil prices rebounded after Wednesday’s near-5% selloff as Donald Trump warned the United States remained prepared to strike Iran if negotiations failed, saying the situation was “right on the borderline” while indicating there was still room to wait “a few days” before taking further action.
Brent crude settled at US$105.02 a barrel on Wednesday after Trump previously stated Washington was in the “final stages” of reaching a deal with Tehran before later hardening his stance overnight.
Iran responded by warning it was prepared for escalation, with parliament speaker Mohammad Bagher Qalibaf stating the country must strengthen its “readiness for a decisive and effective response,” describing the confrontation as “a war of wills.”
Iranian state media nevertheless confirmed officials were still reviewing the latest U.S. proposal. Pakistan’s army chief Asim Munir travelled to Tehran on Thursday to continue mediation efforts, while Iran’s foreign ministry repeated demands for the release of frozen assets and the lifting of the port blockade.
The Strait of Hormuz remained largely closed, with Iran’s newly established Persian Gulf Strait Authority publishing a map outlining a claimed controlled maritime zone that would require vessels to seek permission before transit.
U.S. Central Command said 91 ships had been rerouted because of the blockade and confirmed it had boarded and searched an Iranian-flagged tanker before later releasing it.
The UN Food and Agriculture Organization warned the disruption risks creating “a severe global food price crisis,” noting that before the conflict the Strait of Hormuz handled around one-fifth of global oil shipments and roughly one-third of global fertiliser supply.
Trump also said Israeli Prime Minister Benjamin Netanyahu would do “whatever I want him to do” regarding Iran and added he was “in no hurry” to finalise a deal. Israel’s military chief meanwhile said the IDF remained at its “highest level of alert.”
UK market round-up
Smiths Group Plc (LSE:SMIN) cut its FY2026 revenue guidance after the Middle East conflict reduced sales at its John Crane division by around £10 million during the third quarter.
Close Brothers Group (LSE:CBG) increased its motor finance provision by £30 million in the third quarter but said it remains on track to meet full-year expectations.
Tate & Lyle (LSE:TATE) described recent financial performance as “disappointing” and forecast only modest revenue growth for 2027 following a recent takeover approach from Ingredion.
Ibstock Plc (LSE:IBST) said full-year earnings should broadly meet expectations but warned that cost inflation pressures are expected to continue into the second half.
AJ Bell plc (LSE:AJB) said full-year profit is running ahead of guidance and announced a new share buyback programme after posting record net inflows and 12% first-half revenue growth.
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