The FTSE 100 traded lower on Wednesday as investors reacted to escalating conflict between the United States and Iran, while weaker-than-expected economic growth in China added to concerns over the global outlook. The UK benchmark fell 0.60 percent in early trading, with Germany’s DAX down 0.90 percent and France’s CAC 40 losing 0.28 percent. Sterling strengthened 0.17 percent against the US dollar to 1.3414.
China slowdown and geopolitical tensions pressure markets
China’s economy expanded by 4.3 percent year on year during the second quarter, marking its slowest pace of growth since late 2022. The figure fell short of market expectations and below the Chinese government’s annual growth target, raising concerns about demand in one of the world’s largest commodity-consuming economies.
Investor sentiment was also affected by a fourth consecutive day of military action between the United States and Iran. The United States confirmed further strikes on Iranian military targets near the Strait of Hormuz and reinstated a naval blockade affecting vessels travelling through Iranian ports.
US President Donald Trump warned that military operations could intensify further unless Iran returned to negotiations. Iran responded with retaliatory strikes against US military assets in the region, while attacks on commercial shipping in the Strait of Hormuz heightened concerns over global energy supplies.
Oil rises as supply concerns increase
Brent crude climbed 1.4 percent to 85.90 dollars a barrel, while West Texas Intermediate crude rose 1.2 percent to 80.32 dollars as investors assessed the potential impact of disruption to Middle East oil exports.
Gold prices moved lower despite the geopolitical uncertainty, with futures falling 0.85 percent to 4,034.40 dollars an ounce and spot gold declining 0.60 percent to 4,029.69 dollars.
UK corporate news
B&M (LSE:BME) reported 2 percent revenue growth in the first quarter, supported by strong trading in France and Heron Foods despite weaker like-for-like sales in the UK.
Barratt Redrow (LSE:BTRW) completed homes at the upper end of its guidance for the 2026 financial year and announced plans for a 400 million pound share buyback programme during 2027.
Thames Water said it has sufficient funding through the fourth quarter of 2026 as it continues discussions with creditors, regulators and the UK government regarding its recapitalisation plans.
Rio Tinto (LSE:RIO) increased first-half copper equivalent production by 3 percent and maintained full-year production guidance across its major commodities.
Antofagasta (LSE:ANTO) reported a 9.5 percent decline in first-half copper production but kept its full-year production forecast unchanged.
Hunting (LSE:HTG) maintained full-year EBITDA guidance after first-half performance met expectations, supported by continued strength in its subsea and perforating businesses.
ICG (LSE:ICG) reported a 10 percent increase in fee-earning assets under management, driven by strong fundraising for its flagship European structured capital strategy.
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