Category: Market Summary

UK equities moved lower on Thursday as investors continued to assess developments surrounding the Strait of Hormuz and tensions between the US and Iran, while sentiment across wider European markets remained cautious.

The FTSE 100 was down 0.25% at 03:25 ET (07:25 GMT), while Germany’s DAX declined 0.45% and France’s CAC 40 edged 0.02% lower. Sterling strengthened slightly against the dollar, with GBP/USD rising 0.05% to 1.3613.

Attention remained firmly on the Strait of Hormuz after Axios cited two unnamed US officials as saying Washington has quietly operated a shipping corridor through the strategically important waterway for several weeks. According to the report, nightly convoys travelling along the Omani coast have been transporting around 10 million barrels per day, approximately half the volume seen before the conflict, with US air cover provided following a two-week operation targeting Iranian radar capabilities.

Separately, Iranian Foreign Minister Abbas Araghchi told his Mauritanian counterpart that Islamic countries should strengthen cooperation through the Organisation of Islamic Cooperation to “counter the Zionist regime’s plots,” according to Iran’s Mehr News Agency.

US President Donald Trump also addressed the Hormuz situation on Wednesday, expressing frustration that South Korea had declined to assist with securing the waterway despite obtaining “60%” of its oil from the region.

Trump separately said he expected to meet North Korean leader Kim Jong Un this year, commenting that Kim “likes me” in contrast with his predecessors.

Trump increases economic pressure on Iran

Washington intensified its economic campaign against Tehran late on Wednesday, with Trump announcing what he described as the “most crushing economic operation ever taken against any country”.

The president warned that countries supporting Iranian financial institutions, banks, airports or shipping registries could face “tremendous economic consequences.” Trump characterised the new campaign as “economic d-day.”

Araghchi responded on social media platform X, arguing that the announcement was intended to distract from economic challenges facing the US, including “unprecedented debt & surging interest costs”. He also accused Washington of “economic terrorism” and warned of consequences for the global economy and national sovereignty.

US Treasury buybacks offer support to risk sentiment

Investors were also digesting a US Treasury decision to at least double buyback operations at the longer end of the yield curve.

According to Jefferies strategist Mohit Kumar, the minimum size of operations covering the 10-to-20-year and 20-to-30-year segments will increase to $4 billion from $2 billion previously.

“We view yesterday’s announcement as a signal that Bessent is conscious of the long end yields and is ready to take steps to control the long end,” Kumar said in a note.

The announcement contributed to a six-basis-point decline in the 10-year US Treasury yield and initially supported gold and cryptocurrency markets as the dollar weakened.

Kumar said Jefferies remained “long gold” and continued “to see value over the medium term.” He also described Wednesday’s Federal Open Market Committee minutes as “less hawkish than feared,” noting that most policymakers expected inflation to moderate during the remainder of the year.

Oil rises as Hormuz uncertainty continues

Oil prices strengthened as traders monitored developments surrounding the key Middle Eastern shipping route. Brent crude advanced 1.4% to $92.91 a barrel, while WTI gained 1.33% to $85.52.

Gold prices moved in the opposite direction during Thursday’s trading. December futures slipped 0.03% to $4,544.65, while spot gold declined 0.78% to $4,487.88 an ounce.

UK company news

Hays (LSE:HAS) cut its full-year dividend by 65% and announced plans to withdraw from seven markets as subdued hiring conditions continued to weigh on permanent recruitment fees.

JD Sports (LSE:JD.) lowered its FY26/27 profit expectations after the decline in second-quarter sales accelerated, with weakness in North America proving a particular drag on performance.

Focus keyphrase: FTSE 100 US-Iran Hormuz tensions

Meta description: The FTSE 100 falls as investors monitor the US-Iran standoff over the Strait of Hormuz, while oil prices rise and UK corporate updates remain in focus.

European equities traded close to unchanged on Wednesday as a retreat in global bond yields provided some relief, while investors turned their attention to the Federal Reserve’s July policy meeting minutes due later in the session.

Sovereign debt markets stabilised after recent volatility. German and French government bond yields steadied, while the 30-year U.S. Treasury yield eased to around 5.27% after reaching 5.3371% on Tuesday, its highest level in almost two decades.

UK Inflation Rises to 2.9%

Sterling was broadly stable after the latest inflation figures showed UK consumer prices accelerating in line with expectations during July, largely because of higher household energy costs.

The consumer price index increased 2.9% year-on-year, compared with a 2.6% rise in June.

European benchmarks were mixed. France’s CAC 40 Index gained 0.3%, while the UK’s FTSE 100 Index and Germany’s DAX Index both slipped 0.1%.

Investors are now waiting for the Federal Reserve minutes for further indications of how policymakers assessed inflation, economic conditions and the outlook for interest rates at their July meeting.

Straumann and Carlsberg Shares Come Under Pressure

Corporate earnings generated some of the session’s largest individual share-price movements.

Straumann (TG:QS51) fell sharply after the Swiss dental implant specialist reported first-half net profit below analyst expectations.

Carlsberg (TG:CBGB) also suffered a significant decline after the Danish brewer’s operating performance for the first half of 2026 missed forecasts.

Smith & Nephew (LSE:SN.) moved lower after the British medical technology group announced that Chief Financial Officer John Rogers had resigned from the board with immediate effect. Rogers is leaving the company to take up a new position in the United States.

Geberit Rallies Following Strong Quarterly Results

Geberit (TG:GBRA) moved in the opposite direction, with shares surging after the sanitary products manufacturer delivered second-quarter results ahead of market expectations.

With European indices showing limited overall movement, attention remains centred on interest-rate expectations and the upcoming Federal Reserve minutes, which could provide the next major signal for global bond and equity markets.

U.S. stock futures were subdued on Wednesday as markets recovered from the previous session’s semiconductor-led decline and investors prepared for the release of minutes from the Federal Reserve’s July policy meeting.

At 03:11 ET (07:11 GMT), Dow futures advanced 42 points, or 0.1%, while S&P 500 futures were little changed. Nasdaq 100 futures declined 40 points, or 0.1%.

Wall Street closed lower on Tuesday as weakness in semiconductor stocks combined with rising government bond yields to weigh on sentiment. Vital Knowledge analysts linked the chip-sector retreat to profit-taking and concerns about a “tidal wave” of debt issuance associated with the artificial intelligence investment cycle.

Heavy spending on AI infrastructure remains under scrutiny, particularly the enormous capital required to develop advanced data centres. Questions over whether current investment levels can generate sufficient returns have become an increasingly important issue for technology investors.

Deutsche Bank analysts said concerns surrounding fiscal deficits, higher oil prices and the continuing Iran conflict also contributed to the rise in global bond yields. Treasury yields subsequently retreated after weaker U.S. housing and industrial production figures reduced expectations for rapid monetary tightening.

July Fed Minutes Could Clarify Policy Debate

Recent softer employment data and relatively contained inflation figures have reduced market expectations for a Federal Reserve rate increase in the coming months.

Investors will therefore closely examine the minutes from the Fed’s July meeting, when policymakers voted to leave interest rates unchanged.

Fed Chair Kevin Warsh provided little indication of what could come next, saying the central bank will “not waver” in its commitment to returning inflation to the 2% target.

The minutes could provide greater detail about divisions within the Federal Open Market Committee. Warsh characterised the meeting as a “good family fight,” with three policymakers opposing the decision to keep rates unchanged and instead favouring a 25-basis-point increase.

Markets will be looking for evidence of how officials are balancing inflation risks against signs of cooling in parts of the U.S. economy.

Target, Lowe’s and Analog Devices Prepare to Report

Corporate earnings are another major focus, particularly results from retailers that could provide fresh information about consumer spending.

Target (NYSE:TGT) is due to report before the opening bell. The retailer raised its annual sales growth forecast in May for the first time in two years despite acknowledging continued macroeconomic uncertainty.

Chief Executive Michael Fiddelke previously welcomed the company’s 5.6% first-quarter sales increase but cautioned that he would not “confuse this progress with potential.”

Lowe’s (NYSE:LOW) will also release quarterly numbers after rival Home Depot (NYSE:HD) delivered better-than-expected second-quarter sales and profit. Demand for repair and maintenance products helped Home Depot offset weaker spending on major renovation projects.

Semiconductor manufacturer Analog Devices (NASDAQ:ADI) is also scheduled to report. Its previous third-quarter revenue outlook exceeded expectations as growing AI infrastructure investment supported demand for semiconductor and sensor products.

U.S. Delays 50% Canadian Tariffs

Trade tensions eased slightly after President Donald Trump announced a three-day suspension of planned 50% tariffs on selected Canadian imports.

The postponement was announced only hours before the tariffs were scheduled to begin, giving the U.S. and Canada additional time to complete negotiations.

Trump said the two countries have a “deal,” pending “the finalization of documents.”

The proposed tariffs would affect approximately $20 billion of Canadian goods, including furniture, wine, fishing rods and hockey sticks.

The Office of the U.S. Trade Representative said the emerging agreement would provide greater Canadian market access for U.S. products and include “alignment” on digital trade.

Canadian Prime Minister Mark Carney said negotiations had progressed but warned that “important work” remained. He also reiterated his ambition to make Canada’s economy “more independent” and “competitive”.

OpenAI and Anthropic Results Highlight Intensifying AI Competition

Artificial intelligence companies are also in focus following a Wall Street Journal report on the financial performance of OpenAI (NASDAQ:OAI) and Anthropic (NASDAQ:ANTP).

OpenAI reportedly generated second-quarter revenue of $6.7 billion, an increase of 18% from $5.7 billion during the first quarter, although its losses widened.

Anthropic reportedly delivered significantly faster growth, more than doubling quarterly revenue to $11.6 billion while recording a small operating profit.

The figures could point to shifting competitive momentum within the AI industry. Slower growth for ChatGPT and increased developer adoption of Anthropic’s Claude Code are adding pressure on OpenAI to strengthen its growth trajectory as competition across generative AI intensifies.

European equities were subdued on Wednesday as investors struggled to regain confidence following a broad cross-asset selloff that drove sovereign bond yields sharply higher and disrupted the positive momentum previously seen across equity markets.

The pan-European Stoxx Europe 600 Index was little changed, remaining close to a two-week low after suffering its steepest one-day decline in almost a month during the previous session.

Performance across major regional markets was similarly restrained. Germany’s DAX declined 0.2%, while France’s CAC 40 gained 0.2%. London’s FTSE 100 and Spain’s IBEX 35 were broadly unchanged.

Investors were still assessing the fallout from Tuesday’s decline, when escalating tensions in the Persian Gulf, rising crude oil prices and benchmark borrowing costs reaching multi-year highs triggered a rapid reduction in risk exposure.

Higher Bond Yields Put Pressure on Equity Valuations

Germany’s 10-year Bund yield climbed to 3.22%, its highest level since May 2011, while the U.S. 30-year Treasury yield moved above 5.30%. The sharp rise in risk-free rates is increasing the discount rate applied to equities and creating additional pressure on valuations.

Higher discount rates tend to have a particularly significant impact on growth-oriented and duration-sensitive sectors such as technology, software and real estate, as they reduce the present value of expected future cash flows.

At the same time, elevated government bond yields make sovereign debt more competitive with equities. When corporate earnings yields provide only a limited premium over relatively low-risk government securities, investors have a greater incentive to shift capital away from stocks and towards bonds.

ECB Comments and Higher Oil Prices Revive Rate-Hike Expectations

Concerns over tighter monetary policy were reinforced after European Central Bank Chief Economist Philip Lane warned on Tuesday that Eurozone inflation, currently around 3%, remains “well above” the ECB’s 2% objective.

Although inflation has retreated substantially from its previous double-digit highs, Lane indicated that a rate of around 3% remains problematic for policymakers, particularly given the possibility that higher energy prices could generate a second wave of inflationary pressure.

Brent crude futures remained close to three-week highs at around $91.50 per barrel as commercial shipping through the Strait of Hormuz continued to face significant disruption amid changes in the military situation across the Persian Gulf.

Persistent inflation combined with elevated commodity prices has prompted a substantial reassessment of the interest-rate outlook. Money markets are now close to fully pricing in a 25-basis-point ECB rate increase at the September meeting, replacing earlier expectations that policymakers would maintain rates unchanged for an extended period.

Lagarde Comments and Fed Minutes Take Centre Stage

Attention is now turning to remarks from ECB President Christine Lagarde, with investors looking for clues about how policymakers intend to respond to the combination of persistent inflation, higher energy costs and weakening economic momentum.

Markets will also examine the Federal Reserve’s minutes from its July FOMC meeting. Investors across bond and equity markets will be looking for evidence of how concerned Fed officials were about cooling labour-market conditions before the recent sharp rise in longer-term borrowing costs.

The two events could provide important guidance for global markets as investors assess whether renewed inflationary pressure will force central banks to maintain tighter monetary policy even as economic growth faces increasing headwinds.

UK equities moved higher on Wednesday as strength across major mining companies helped the FTSE 100 overcome a fresh rise in domestic inflation and renewed geopolitical uncertainty surrounding the Persian Gulf.

The FTSE 100 gained 0.06% as of 03:25 ET (07:25 GMT), putting London ahead of a mixed performance across continental Europe. Germany’s DAX slipped 0.12%, while France’s CAC 40 advanced 0.24%. Sterling strengthened 0.15% against the US dollar to 1.3552.

Mining Shares Lead London Market Higher

Mining companies provided much of the support for the FTSE 100, with Rio Tinto (LSE:RIO) and Anglo American (LSE:AAL) among the strongest performers. Glencore (LSE:GLEN) and Antofagasta (LSE:ANTO) also advanced as metals stocks participated in a broader resources rally.

The gains came alongside another increase in crude oil prices and continued geopolitical risk surrounding the Middle East, helping commodity-related shares offset concerns generated by the latest UK inflation figures.

UK Inflation Climbs to Four-Month High

UK consumer price inflation accelerated to 2.9% in the 12 months to July, up from 2.6% in June and matching economists’ expectations. It was the first increase in the annual inflation rate since March.

Energy costs were a major contributor, with gas prices jumping 14.7%, their largest monthly increase since October 2022. The rise followed Ofgem’s decision to increase the household energy price cap by £221 to an annual equivalent of £1,862.

Core inflation remained at 2.6%, rather than easing slightly as economists had anticipated. Services inflation provided a more encouraging signal, declining to 3.4% from 3.6%.

The Office for National Statistics noted that this was the first energy price cap assessment period affected by the Middle East conflict, although the resulting inflationary impact remained relatively concentrated rather than spreading broadly through consumer prices.

Capital Economics deputy chief UK economist Ruth Gregory said the figures showed that “underlying inflation remains contained,” pointing to a fourth consecutive monthly decline in food and drink inflation to 1.3%, its lowest level since August 2024.

Analysts See Limited Pressure for Bank of England Rate Hikes

Capital Economics maintained its forecast that the Bank of England will leave interest rates at 3.75% throughout this year before reducing them to 3.00% next year. That outlook remains considerably below market expectations for rates of between 4.25% and 4.50%.

Jefferies strategist Mohit Kumar said weaker employment figures combined with the inflation data “would help to contain BoE hike expectations,” with domestically generated inflationary pressures remaining relatively subdued despite higher energy costs.

However, Capital Economics warned that the delayed impact of elevated energy prices could lift headline inflation towards 3.5% later this year. Manufacturing PMI output-price indicators also suggest core goods inflation could increase from 0.9% towards 3%.

“It will probably be just a matter of time before this filters through into higher CPI inflation,” Gregory wrote.

Iran Disputes Missile Claims as Regional Tensions Persist

Geopolitical concerns remained another influence on markets after Iran rejected allegations that missiles had been launched from its territory towards the United Arab Emirates.

Iran’s Mehr News Agency quoted foreign ministry spokesman Esmail Baghaei describing the UAE allegations as “completely baseless”. He urged regional governments to avoid “unfounded accusations”, referring to what he characterised as a history of false-flag operations involving the US and Israel.

Meanwhile, Iranian Parliament Speaker Mohammad Bagher Ghalibaf, during a visit to Baghdad for regional cooperation discussions, said Islamic countries should strengthen relations “without foreign interference”.

U.S. President Donald Trump said on Truth Social that “there are no talks or conversations going on, or scheduled, with the Islamic Republic of Iran,” while adding that the naval blockade remains “in full force and effect” and that the Strait of Hormuz is “open and operating.”

Separately, Al Jazeera reported that the U.S. administration had instructed negotiators to pause discussions until Tehran is “ready to make a deal.”

Oil Prices Rise as Markets Track Persian Gulf Risks

Energy markets remained sensitive to developments in the region. Brent crude gained 0.62% to $91.59 per barrel, while WTI advanced 0.67% to $84.62.

Precious metals delivered a mixed performance. Gold futures declined 0.28% to $4,408.26, while spot gold increased 0.46% to $4,354.47.

For the FTSE 100, strength among heavyweight mining shares was sufficient to keep the index in positive territory despite the hotter UK inflation reading and persistent geopolitical uncertainty. Investors remain focused on whether rising energy costs will feed more broadly into inflation and alter expectations for the Bank of England’s next policy moves.

FTSE 100 opens flat as UK inflation rises, Trainline faces a CMA probe, Defence Holdings outlines its fund strategy and Brent crude slips.

Market Overview

The FTSE 100 opened broadly unchanged at 10,727.84, down less than 0.01 per cent from its previous close, as gains among miners helped offset concerns after UK inflation rose to a four-month high. The Euronext 100 gained 0.11 per cent to 1,951.77, while Germany’s DAX slipped 0.03 per cent to 26,120.76 as European investors assessed elevated bond yields and awaited comments from ECB President Christine Lagarde and Federal Reserve minutes. Overnight in the US, the Nasdaq closed lower at 26,289.71 and the S&P 500 fell to 7,691.76.

Commodity markets were mixed, with copper and gold lower, Brent crude edging down and natural gas slightly higher. Oil markets remained sensitive to uncertainty over exports through the Strait of Hormuz. Against sterling, the US dollar and Japanese yen weakened marginally, the Australian dollar strengthened slightly, while the Swiss franc and euro were unchanged. Bitcoin was down.

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Market Numbers

FTSE 100: Down (-0.001%), 10,727.84
Euronext 100: Up (+0.11%), 1,951.77
DAX: Down (-0.03%), 26,120.76
NASDAQ: Down, 26,289.71
S&P 500: Down, 7,691.76

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In the Headlines

CMA booking fee investigation – Trainline (LSE:TRN)
Trainline said it will cooperate fully with a Competition and Markets Authority investigation into how certain fees are displayed during its UK booking process. The regulatory scrutiny puts the transparency of booking charges in focus and could result in further changes to how costs are presented to customers.

Defence fund strategy – Defence Holdings (LSE:ALRT)
Defence Holdings CEO Andrew Roughan has explained the rationale behind the company’s £2 million cornerstone commitment to a new defence fund. The investment activates the Investment pillar of its strategy and is intended to give the group equity exposure to defence technology businesses alongside its core commercial activities.

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Currencies (vs GBP)

USD: Down (-0.02%), $1.3537
CHF: Unchanged (0.00%), Fr.1.0995
EUR: Unchanged (0.00%), €1.1693
JPY: Down (-0.01%), ¥215.978
AUD: Up (+0.00%), $1.9116
Bitcoin (BTC/GBP): Down, £47,464.50

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Commodities

Copper: Down
Gold: Down
Brent Crude: Down
Natural Gas: Up

U.S. equity futures pointed to another negative start on Tuesday as rising Treasury yields and higher crude oil prices threatened to extend Wall Street’s two-session pullback.

Technology stocks were positioned to bear the brunt of the selling, with Nasdaq 100 futures down 1.3%. The weakness came as the yield on the 30-year U.S. Treasury climbed to its highest level in nearly two decades, increasing pressure on growth stocks whose valuations are particularly sensitive to borrowing costs.

Persistent inflation concerns linked to the Middle East conflict have helped push longer-term yields higher, even as recent economic indicators have reduced expectations for an imminent Federal Reserve rate increase.

Oil Rally Complicates the Inflation Outlook

U.S. crude futures advanced another 0.8% on Tuesday after surging 2.6% in the previous session, with investors becoming increasingly doubtful that Washington and Tehran will reach an agreement capable of easing the conflict.

Higher energy prices risk adding fresh inflationary pressure to the U.S. economy and could keep financial conditions restrictive even if the Federal Reserve refrains from raising interest rates.

Daniela Hathorn, Senior Market Analyst at Capital.com noted the increase in treasury yields comes “despite softer recent economic data reducing expectations for an imminent Fed hike.”

“Instead, the long end is responding to persistent inflation risks, heavy government borrowing and growing competition for capital—including debt issuance associated with the AI investment boom,” Hathorn said.

She added, “That creates an uncomfortable environment for equities because financial conditions can tighten even without the Fed raising rates.”

Major U.S. Indices Extend Recent Pullback

The weaker futures followed Monday’s broadly negative trading session, when stocks struggled for direction initially before selling intensified later in the day.

The S&P 500 fell 40.70 points, or 0.5%, to 7,745.06, closing near its session low and moving further below the record closing high established last Thursday.

The Dow dropped 272.63 points, also 0.5%, to 53,459.78, while the Nasdaq declined 84.25 points, or 0.3%, to 26,644.91.

Monday’s losses extended the modest pullback recorded during Friday’s session.

Iran Rules Out Ceasefire Negotiations

Crude prices accelerated higher as geopolitical tensions surrounding Iran returned to the centre of market attention.

U.S. oil futures gained more than 2% on Monday after indications emerged that Tehran had ruled out talks with Washington to extend a 60-day ceasefire scheduled to expire on Tuesday.

“We did not start any negotiations at all, and the U.S. violated the understanding from the very beginning; therefore, the 60-day issue is not relevant,” Iran Foreign Ministry spokesman Esmail Baghaei said, according to state news agency Tasnim.

Concerns about a broader regional confrontation increased further after President Donald Trump threatened Oman during an interview with Fox News, warning, “If Oman gets in the way, we’ll bomb the s— out of them.”

The comments came as Iran and Oman appeared to be making progress towards an understanding over management of the Strait of Hormuz, one of the world’s most important routes for energy shipments.

Airlines Hit as Energy Costs Rise

Airline stocks were among Monday’s biggest casualties as the jump in crude prices raised concerns about higher fuel expenses. The NYSE Arca Airline Index fell 2.8%.

Software stocks also experienced substantial selling, with the Dow Jones U.S. Software Index dropping 2.7%.

Telecommunications, computer hardware and housing shares were also under pressure, while the market displayed greater resilience in oil producers, biotechnology companies and semiconductor stocks.

The combination of elevated long-term borrowing costs, persistent geopolitical uncertainty and rising energy prices leaves Wall Street facing a difficult backdrop in which financial conditions could tighten even without additional Federal Reserve action.

European equities moved broadly lower on Tuesday as escalating tensions between the United States and Iran unsettled investors, pushed oil prices higher and drove long-dated eurozone government bond yields to multi-year highs.

Brent crude futures climbed above $91 a barrel after U.S. President Donald Trump ruled out extending a temporary ceasefire agreement with Iran. Tehran, meanwhile, said it was preparing to adopt a “fully offensive” military posture, further reducing expectations for an easing of the conflict.

Strait of Hormuz Incident Adds to Market Concerns

Fresh concerns over security in the Middle East emerged after a cargo vessel was struck by a projectile while travelling through the Strait of Hormuz, according to the UKMTO.

The incident added to worries surrounding the safety of commercial shipping through the strategically important waterway, increasing uncertainty around global energy supplies and supporting higher crude prices.

Against this backdrop, European markets remained under pressure. France’s CAC 40 Index declined 0.4%, while Germany’s DAX Index fell 0.3%.

The U.K.’s FTSE 100 Index moved against the broader regional trend, however, gaining 0.2%.

UK Unemployment Holds at 4.9%

Investors also assessed fresh economic figures from the United Kingdom, where the unemployment rate remained at 4.9% in the three months to June, unchanged from the previous period, according to the Office for National Statistics.

The number of job vacancies continued to decline, falling by 6,000 to 707,000 during the three months to July.

Currency markets were relatively subdued, with the U.S. dollar edging higher but remaining close to multi-month lows against major counterparts.

Investors were awaiting several U.S. economic releases later in the session, including import and export prices, housing starts, industrial production and pending home sales.

Basilea Pharmaceutica Surges After Profit Upgrade

Among individual stocks, Basilea Pharmaceutica (TG:PK5) shares surged after the Swiss biopharmaceutical company raised its 2026 profit outlook.

The revised forecast followed a strong first-half performance, with net profit increasing 77% compared with the corresponding period last year.

HgCapital Trust (LSE:HGT), meanwhile, moved lower after the British investment trust announced plans to invest approximately £20 million through its manager Hg in Nourish Care, a nutritional diet consulting platform.

Mining heavyweight BHP (LSE:BHP) traded modestly higher after reporting a 9% increase in annual net profit.

With geopolitical risks driving energy prices and bond yields higher, European markets remained largely defensive as investors monitored developments surrounding Iran and the strategically important Strait of Hormuz.

U.S. stock futures traded lower on Tuesday as markets faced a combination of renewed oil-price pressure, continued disruption in the Strait of Hormuz and the approaching introduction of additional U.S. tariffs on Canadian goods.

Investors were also preparing for quarterly results from Home Depot (NYSE:HD), which will provide another indication of the health of the U.S. consumer. Gold, meanwhile, slipped below $4,400 an ounce as Treasury yields moved higher.

Nasdaq Futures Lead Declines

At 03:05 ET (07:05 GMT), Dow futures were down 49 points, or 0.1%, while S&P 500 futures fell 29 points, equivalent to 0.4%. Nasdaq 100 futures were the weakest of the three, dropping 209 points, or 0.7%.

The moves followed a negative session on Monday, when the major Wall Street averages declined and the S&P 500 recorded its worst trading day of August so far.

“The overall equity mood soured,” analysts at Vital Knowledge said.

Semiconductor stocks provided some relief. Sentiment towards the sector was supported by reports surrounding revenue expectations at Claude developer Anthropic (NASDAQ:ANTP), as well as Nvidia’s (NASDAQ:NVDA) smaller-than-expected financial commitment to an Ohio data centre. Vital Knowledge said the developments helped reinforce enthusiasm surrounding artificial intelligence.

However, Deutsche Bank strategists highlighted the renewed increase in crude prices and the potential inflationary consequences of the Iran war. The move in energy markets was accompanied by higher U.S. government bond yields.

Strait of Hormuz Disruption Keeps Oil Above $90

Brent crude futures rose 0.3% to $91.10 per barrel on Tuesday, while U.S. West Texas Intermediate gained 0.6% to $85.02.

The latest increase followed another incident in the Strait of Hormuz. The United Kingdom Maritime Trade Operations agency said a vessel travelling outbound through the waterway had been struck by an unidentified projectile, damaging its engine room and resulting in a crew casualty.

Political tensions have also intensified after U.S. President Donald Trump ruled out extending the framework ceasefire agreement reached with Tehran in June. The agreement expired on Monday.

Trump said the U.S. had established a back channel with officials from Iran’s Islamic Revolutionary Guard Corps, although Tehran rejected that assertion.

The president also threatened military action against Oman, which has been attempting to negotiate an agreement with Iran to reopen the Strait of Hormuz. Both countries border the strategically important shipping route.

Commercial tanker traffic remains effectively suspended through the strait, which carried approximately one-fifth of global oil flows before the war began in late February.

“With both sides still far apart, investors grew pessimistic that the Strait of Hormuz would properly reopen any time soon,” Deutsche Bank analysts said.

Higher Treasury Yields Pressure Gold

Gold moved below $4,400 an ounce as rising U.S. Treasury yields reduced the appeal of the non-interest-bearing precious metal.

The benchmark 10-year Treasury yield extended its advance as investors considered whether higher energy costs could complicate the Federal Reserve’s inflation outlook.

Markets are awaiting minutes from the Fed’s July meeting for further guidance on interest rates.

Expectations for a possible September rate increase have risen slightly because of inflation concerns linked to the Middle East conflict. Even so, the probability remains considerably lower than it was a week ago following unexpected employment losses, softer consumer inflation and disappointing July retail sales.

Canada Faces Midnight Tariff Deadline

Canada is preparing for another round of U.S. tariffs scheduled to take effect at midnight on Tuesday unless negotiations produce a last-minute agreement.

U.S. Trade Representative Jamieson Greer said any retaliation by Canada would not be “tolerated,” while adding that he expected the longstanding U.S. trading partner to take a “more conciliatory approach.”

Canadian Prime Minister Mark Carney is expected to speak with Trump on Tuesday, according to media reports. Carney has reportedly instructed Canadian negotiators to consider concessions that could prevent the new tariffs while potentially reducing some existing trade barriers.

The Trump administration threatened in July to impose 50% duties on a broad range of Canadian products, including wine, furniture, fishing rods and hockey sticks, invoking a Depression-era law aimed at countries accused of discriminating against U.S. goods.

Home Depot Results Could Shed Light on Consumer Demand

Home Depot (NYSE:HD) is due to report quarterly earnings, beginning a major week for U.S. retail results that will also include Walmart and Target.

The home-improvement retailer warned in May that economic uncertainty surrounding the Iran war, combined with affordability pressures, was discouraging consumers from undertaking major renovation projects.

Home Depot sells products ranging from around $5 to more than $500, while its average customer basket is approximately $90, leaving the business sensitive to changes in discretionary household spending.

CEO Ted Decker previously said customers appeared to be in “reasonably good shape,” although they were delaying larger remodelling projects.

The latest earnings could therefore provide investors with fresh evidence on whether consumers remain cautious about major purchases and home improvement spending.

FTSE 100 edges higher as Made Tech raises guidance, Great Western starts drilling and Middle East risks keep energy markets in focus.

Market Overview

The FTSE 100 opened 0.01 per cent higher at 10,720.85, with energy shares providing support as investors continued to assess risks surrounding the Strait of Hormuz. The Euronext 100 edged 0.01 per cent higher to 1,971.09, while Germany’s DAX fell 0.40 per cent to 26,233.55 as geopolitical concerns weighed on European sentiment. Overnight in the US, the Nasdaq closed lower at 26,644.91 and the S&P 500 declined to 7,745.06.

Geopolitical risk remained the dominant macro theme as fading hopes for progress between the US and Iran kept energy supply concerns in focus. Against sterling, the US dollar, Swiss franc, euro and Japanese yen weakened marginally, while the Australian dollar strengthened and Bitcoin rose slightly. Copper and gold moved lower, natural gas gained, while Brent crude edged down from its previous close despite continuing concerns over Middle East supply.

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Market Numbers

FTSE 100: Up (+0.01%), 10,720.85
Euronext 100: Up (+0.01%), 1,971.09
DAX: Down (-0.40%), 26,233.55
NASDAQ: Down, 26,644.91
S&P 500: Down, 7,745.06

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In the Headlines

Guidance Raised – Made Tech Group (LSE:MTEC)
Government technology specialist Made Tech raised its FY27 guidance after securing a record £40 million government contract. The win strengthens its contracted workload and improves expectations for the current financial year.

Major Drilling Programme – Great Western Mining (LSE:GWMO)
Mineral exploration company Great Western Mining has begun a major drilling programme at its Nevada tungsten project. The campaign marks an important step in evaluating the project’s mineral potential and advancing its exploration strategy.

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Currencies (vs GBP)

USD: Down (-0.01%), $1.3551
CHF: Down (-0.00%), Fr.1.0985
EUR: Down (-0.00%), €1.1699
JPY: Down (-0.00%), ¥215.915
AUD: Up (+0.00%), $1.9063
Bitcoin (BTC/GBP): Up, £47,448.10

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Commodities

Copper: Down
Gold: Down
Brent Crude: Down
Natural Gas: Up