UK equities moved modestly lower on Thursday as investors assessed a slowdown in British economic growth alongside continuing geopolitical uncertainty surrounding the Strait of Hormuz.
As of 03:06 ET (07:06 GMT), the FTSE 100 was down 0.10%, underperforming its major European counterparts. Germany’s DAX advanced 0.40%, while France’s CAC 40 gained 0.27%.
Sterling was broadly steady against the U.S. dollar, with GBP/USD trading near 1.3481, down around 0.10%.
UK GDP Growth Cools in Second Quarter
Preliminary figures from the Office for National Statistics showed that the UK economy expanded 0.4% during the second quarter of 2026, matching economists’ forecasts but slowing from growth of 0.6% in the opening three months of the year.
The monthly figures provided a somewhat stronger signal heading into the second half. GDP increased 0.3% in June, beating expectations for a decline.
That followed unchanged output in May, which was revised down from an earlier estimate of 0.1% growth, while April’s 0.1% contraction was left unrevised.
The stronger June performance helped offset the subdued start to the quarter, although the overall figures confirmed that the pace of UK economic expansion moderated from the first quarter.
Strait of Hormuz Tensions Keep Investors Cautious
Geopolitical developments remained another major influence on market sentiment as uncertainty surrounding the Strait of Hormuz continued.
U.S. Central Command said on Wednesday that American forces had redirected 59 commercial vessels, disabled three and boarded two as of August 12 as part of efforts to enforce a naval blockade against Iran. CENTCOM described the operation as America’s “steel wall blockade” in the Strait of Hormuz.
U.S. President Donald Trump said earlier on Wednesday that the United States had “total control” of the Strait of Hormuz and would retain it. He described the naval operation as a “wall of steel” and said Iran had no navy, air force or effective military leadership.
Meanwhile, Iranian Foreign Minister Abbas Araghchi criticised France and other Western countries over what he characterised as hypocrisy regarding human rights.
A New York Times report concerning events around last month’s NATO summit in Ankara also said Iran had obtained precise information about Trump’s location. According to the report, U.S. officials identified a surface-to-air missile threat against his aircraft, leading to the use of a decoy operation.
Gold and Oil Prices Move Lower
Precious metals weakened during Thursday’s session despite the continuing geopolitical uncertainty.
Gold futures fell 0.70% to $4,436.65 an ounce, while spot gold declined 0.65% to approximately $4,380.
Oil prices also moved lower. Brent crude slipped 0.48% to $88.55 a barrel, while WTI crude declined 0.53% to $82.83.
Energy markets remain sensitive to developments around the Strait of Hormuz given the waterway’s importance to international oil and gas shipments.
UK Round-Up
Antofagasta (LSE:ANTO) reported a 27% increase in first-half core earnings as stronger copper prices helped counter weaker production. The miner also reduced its 2026 production forecast following a shutdown at one of its operations.
Entain (LSE:ENT) exceeded expectations for first-half core profit, with strong customer engagement around the World Cup and cost-saving measures helping the gambling group absorb the impact of higher UK gaming taxes.
With domestic economic growth losing some momentum and geopolitical uncertainty remaining elevated, investors are likely to continue monitoring incoming UK data and developments in the Middle East for direction.
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