The FTSE 100 moved lower on Wednesday as investors assessed further military developments involving the United States and Iran, while Brent crude approached $100 a barrel.
The UK benchmark was down 0.28% as of 03:18 ET (07:18 GMT). Elsewhere in Europe, Germany’s DAX declined 0.52% and France’s CAC 40 fell 0.70%.
Sterling gained 0.19% against the U.S. dollar to $1.3567.
Oil prices continued to rise, with Brent crude up 2.1% at $99.97 a barrel and West Texas Intermediate gaining 1.71% to $94.64.
Precious metals also moved higher. Gold futures increased 0.22% to $4,448.94, while spot gold was up 1.14% at $4,404.93.
The market moves came as the United States and Iran reported further military activity in and around the Gulf.
U.S. Central Command said it had destroyed five Iranian crude carriers after Iran’s Islamic Revolutionary Guard Corps twice fired ballistic missiles at a U.S. Navy warship. CENTCOM said the vessel avoided both missile attacks and that no U.S. personnel were injured.
The IRGC said its forces had targeted two U.S. vessels, eight oil tankers and 10 other “violating ships” in the Strait of Hormuz.
The IRGC also said it had carried out missile strikes against the U.S. al-Azraq base in Jordan, targeting facilities associated with F-35, F-16 and F-15 aircraft. Jordan’s military said it intercepted 18 of 20 missiles fired at its territory, with the remaining two landing in open areas without causing damage.
Separately, Reuters-sourced reporting indicated that Oman and Iran are expected to announce a temporary shipping corridor through the Strait of Hormuz within days.
CENTCOM also released footage showing an Iranian vessel sinking in the Gulf of Oman. Shipping data for the Strait of Hormuz showed six commodity vessels transited the waterway on Tuesday, compared with a 10-day average of 12.
Jefferies’ Mohit Kumar said “Middle East tensions continue to dominate markets” and that a rise in Brent toward $100 “could also draw some optimism that oil prices are reaching a pain point which would make Trump more willing to do a deal.”
ING strategists said “recent developments only reinforce the view that we’re still some way from a restart in talks,” adding that the market “is likely to continue to price in a sizeable risk premium.”
UK company news
Aberdeen (LSE:ABDN) appointed former Sampo chief executive Torbjörn Magnusson as chair-designate and non-executive director. He is set to succeed Douglas Flint, who plans to step down at the company’s annual general meeting in April. Magnusson previously led Sampo and oversaw its £1.7 billion acquisition of Hastings Group.
Energean (LSE:ENOG) reported a 45% increase in first-half profit, supported by the recognition of deferred tax assets in Italy. The company maintained its annual production guidance following the restart of its Israeli operations.
Leave a Reply