- FTSE 100 down 40 points to 8,842
- US opens sharply lower
- Oil jumps to two-month high on supply concerns
- Gold rises on safe-haven allure
- Travel and leisure stocks sink
4:30pm: Footsie finishes Friday 40 points lower
The FTSE 100 finished Friday around 40 points lower, losing 0.47%, to end the week at around 8,842.
“London's FTSE 100 dipped on Friday following a record high closure in the prior session, as Israel's escalating military actions against Iran heightened geopolitical tensions,” Tickmill Group partner Patrick Munnelly.
“However, gains in energy stocks helped to mitigate the losses.”
3:00pm: Energy and mining stocks climb
Energy and mining stocks climbed on Friday as escalating conflict between Israel and Iran sent crude oil and gold prices sharply higher.
BP PLC (LSE:BP.) and Shell PLC (LSE:SHEL, NYSE:SHEL) rose 3.2% and 2.3% respectively.
Fresnillo PLC (LSE:FRES), the Mexico-focused precious metals miner, gained 1.4%, while Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) was up 1.8% as investors flocked to safe-haven assets.
The gains came amid widespread market turmoil after Israeli strikes hit dozens of Iranian military and nuclear targets, killing senior commanders and scientists. Iran responded by launching a wave of drones towards Israel, as both sides warned of prolonged hostilities.
Crude oil surged above $90 a barrel for the first time in months, with traders pricing in the risk of disruption to supply routes through the Strait of Hormuz. Meanwhile, gold touched $2,500 an ounce, reflecting heightened demand for traditional stores of value.
The Israeli operation, dubbed Rising Lion, was described by Prime Minister Benjamin Netanyahu as a direct attack on Iran’s nuclear and ballistic missile programmes. In response, Iran’s supreme leader vowed “severe punishment”.
With tensions threatening to spill across borders, risk appetite faded. But for energy producers and gold miners, the geopolitical shock translated into outsized gains as commodity prices surged.
1:15pm: US futures point lower
US stock futures pointed to a big decline after Israel launched air strikes against Iran’s nuclear and military facilities, further raising tensions in the Middle East and sending investors to the sidelines.
An hour and a half before the market opens, futures for the Dow Jones are down 1%, while those for the S&P 500 are 0.9% weaker and Nasdaq futures are 1.2% lower.
“The question now is whether investors view this flare-up as a relatively contained incident within the longstanding animosity between Israel and Iran, or if this is the spark that ignites a conflagration across the Middle East and then beyond,” said David Morrison, senior market analyst at TradeNation.
“Cynically, given the overnight bounce off the lows, it appears that traders are treating it as the former, and just another opportunity to ‘buy the dip’.
“But this could prove to be simply short-term opportunism, rather than a longer-term play for investors to increase their risk exposure.”
11:55am: Small Cap Headlines
Adriatic Metals PLC (LSE:ADT1, ASX:ADT, OTCQX:ADMLF) has now announced it will be bought by Canadian miner Dundee Precious Metals in a deal worth US$1.25bn. Read more
Vinanz Ltd (LSE:BTC, OTCQB:VINZF), the Bitcoin-focused investment and mining company listed on the London Stock Exchange, has opened a £1m retail share offer as part of a wider push to expand its strategy and shareholder base. Read more
AFC Energy PLC (AIM:AFC, OTC:AFGYF) told investors it has reduced the build cost of its 30kW hydrogen fuel cell generator by around 85%. The cost reduction was achieved through a value engineering exercise and by adopting low-cost stack technology. Read more
Arrow Exploration Corp (TSX-V:AXL, AIM:AXL, OTC:CSTPF) has announced the start of a share buyback programme, for up to £2.7 million of shares. Read more
MP Evans Group PLC (AIM:MPE), a major producer of sustainable palm oil in Indonesia, reported an 11% increase in crop harvest from its plantations for the first five months of 2025, ahead of its annual meeting in London. Read more
Frontier IP Group PLC (LSE:FIPP), which specialises in turning innovative ideas into commercially viable businesses, is establishing a major new innovation hub in Cambridge to accelerate the growth of promising science and technology start-ups. Read more
Allergy Therapeutics PLC (AIM:AGY, OTC:AGYTF), a biotechnology firm specialising in allergy treatments, is showcasing key research findings at the European Academy of Allergy and Clinical Immunology (EAACI) Congress in Glasgow. Read more
Challenger Energy Group PLC (AIM:CEG, OTCQB:BSHPF) has now filed results for what it described as “a transformational year”, and a period in which it recentred its business to focus on offshore Uruguay. Moreover, it secured a farm-out transaction with tier 1 operator, Chevron, and significantly advanced its prospects. Read more
11.45am: Footsie holds steady as US futures slump
The FTSE 100 continues to trade just under 0.5% lower despite heavier losses on European and Asian markets - and an expected decline in US stocks when trading on Wall Street gets underway.
London's blue chip index is currently 38 points (0.42%) down at 8,847.20 - in roughly the same range it's traded all morning.
US futures are pointing to a much weaker start on Wall Street, with the Dow Jones and S&P 500 expected to open 1.1% lower and futures for the Nasdaq indicating a 1.4 fall at the open.
Over on the continent, the Xetra DAX in Frankfurt has shed 1.3% and the Paris CAC 40 is 1.1% lower.
Asian markets have also declined, with the Nikkei 225 in Tokyo closing 0.9% down, the Hang Seng in Hong Kong losing 0.6% and Shanghai's SSE Composite ending 0.8% weaker.
9.50: Small cap wrap
Vinanz Ltd (LSE:BTC, OTCQB:VINZF) has launched a £1m retail share offer, selling shares at 13.75p via the WRAP platform until 16 June. The Bitcoin miner, soon rebranding as London BTC Company, plans to use proceeds to grow its US and Canadian operations. It recently added 16.9 Bitcoins to its treasury holdings.
Renold PLC (AIM:RNO) jumped 11% to 84.41p after agreeing to a £187 million cash takeover by MPE Bidco at 82p per share—a 50% premium to Monday’s close. The deal, backed by US private equity firm MPE, will see Renold merge with Webster Industries to form a global power transmission giant. Renold’s board backs the offer, calling it a chance to accelerate growth.
Adriatic Metals PLC (LSE:ADT1, ASX:ADT, OTCQX:ADMLF) has agreed a US$1.25bn takeover by Dundee Precious Metals, valuing shares at 268p. Adriatic’s stock rose 3.1% to 248.5p. The deal, backed by both boards and key shareholders, comes as Adriatic ramps up production at its Vares silver mine. Completion is expected in late 2025.
Challenger Energy Group PLC (AIM:CEG, OTCQB:BSHPF) says 2024 was a “transformational year” as it shifted focus to offshore Uruguay, farmed out AREA OFF-1 to Chevron for $12.5m, and lined up further deals for OFF-3. It’s also exiting Trinidad. With $8.4m in cash and no debt, CEO Eytan Uliel sees major growth ahead.
AFC Energy PLC (AIM:AFC, OTC:AFGYF) has slashed the build cost of its 30kW hydrogen fuel cell generator by 85% through engineering tweaks and cheaper stack tech. It’s secured a supply deal, is planning volume manufacturing, and aims to hit mid-2026 for first deliveries. A global manufacturing partnership with Volex will help cut costs further.
Allergy Therapeutics PLC (AIM:AGY, OTC:AGYTF) is showcasing strong early data at the European Academy of Allergy and Clinical Immunology (EAACI) Congress in Glasgow. Its peanut allergy vaccine showed safety and fewer reactions in early trials, while its grass pollen treatment improved quality of life beyond existing therapies.
9.15am: Jobs market still under pressure
The UK jobs market stayed sluggish in May, with permanent placements falling again, according to the latest KPMG and REC UK Report on Jobs. Temp hiring held up better, with billings seeing the smallest drop in six months.
Candidate availability surged at the fastest pace since 2020 as redundancies rose and vacancies dried up. Pay growth ticked higher but remains below historic norms.
“Employers are still holding back on hiring,” said KPMG’s Jon Holt.
There were pockets of resilience, with the Midlands posting its first permanent hiring rise in a year, and engineering showing stronger demand. Retail, hospitality and healthcare continued to see sharp declines.
Neil Carberry at REC added: “We’re seeing early signs of promise — but businesses now need a clear plan for growth.”
The Footsie, meanwhile, has retraced some of its losses. It's now down 33 points (0.37%) at 8,852.35.
8.45am: Footsie cushioned by energy stocks
London stocks are still down but the FTSE 100's fall has been cushioned by energy and gold stocks as oil prices rise in response to Israel's air strikes on Iran, and bullion benefits from the flight to safety.
The Footsie is now down 49 points at 8,836.38, faring a lot better than Frankfurt's DAX, which is 1.3% lower and the CAC 40 in Paris, down just over 1%.
US futures are also pointing to a sorry start for the Dow Jones, the S&P 500 and the Nasdaq, all down between 1.3% and 1.4%.
“Global markets are being rattled by an escalation of Middle East tensions as Israel attacked Iran’s nuclear programme overnight," commented interactive investor's Richard Hunter.
While gains in oil and defence stocks, including Shell, BP and BAE Systems have been offset by a sharp descent for the airlines, hit by the double whammy of higher fuel costs as well as potentially damaged demand resulting from tensions in the Middle East region, Hunter says the FTSE offers some stability.
"The premier index could attract some renewed buying interest given the stability and maturity of many of its constituents, as well as its exposure to sectors such as defence and the financials, which have all been strong performers of late," Hunter said.
"Global investors have been seeking alternatives given the volatile backdrop, and for the time being, the likes of the FTSE 100 seem to fit the bill.”
8.15am: Footsie off to a bad start on Middle East tension
The FTSE 100 sank 50 points at the open to 8,835.06, a loss of 0.56%, following a series of Israeli air strikes against Iran’s nuclear and military facilities.
Energy stocks jumped as oil spiked higher in response to the renewed conflict in the Middle East. After soaring over 9%, Brent crude has retraced some of its gains and is up 5% at $73.75 a barrel.
Iran is the third-largest OPEC producer after Saudi Arabia and Iraq.
Shell PLC (LSE:SHEL, NYSE:SHEL) jumped 2.9% and BP PLC (LSE:BP.) gained 2.4% to top the FTSE 100 leaderboard.
Other big gainers included defence contractor BAE Systems PLC (LSE:BA.) with a 1.9% gain and gold miner Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF), up 1.2% as the price of gold rose 1%.
Shares in travel and leisure companies were hit by the renewed tension in the Middle East. British Airways owner International Consolidated Airlines Group SA (LSE:IAG) sank 6.3%, easyJet PLC (LSE:EZJ) fell 5% and Intercontinental Hotels Group PLC (LSE:IHG) dropped 3.1%.
7.30am: Investors head to the sidelines
It's not just the FTSE that's expected to open lower today, with a 43 point (0.5%) decline now predicted at the open. US stock futures are also pointing to a big drop at the open as investors head for safety following Israel's air strikes against Iran’s nuclear and military facilities.
Futures for the Dow Jones, the S&P 500 and the Nasdaq are all down well over 1%.
"The news has led to significant fears about an escalation and a wider regional conflict," Deutsche Bank's Jim Reid commented in his morning note. "For instance, Iran’s armed forces spokesperson said that Israel and the US will receive a 'harsh blow' in response, and Iran’s Supreme Leader said Israel 'should expect a severe punishment'."
In turn, oil prices have surged on the news, with Brent crude up over 9% to $75.60/bbl, Reid noted.
"If sustained, that would be the biggest daily jump in oil prices since May 2020, as the global economy was recovering from the Covid lockdowns. And that’s slightly down from the overnight peak, when prices reached $78.50/bbl," he added.
7.15am: FTSE 100 likely to open lower on renewed Middle East tension
The FTSE 100 is expected to fall when the market opens after Israel launched air strikes against Iran’s nuclear and military facilities.
A 33-point fall has been called for London's blue-chip index on the futures market.
Oil prices have jumped in response, with Brent crude climbing over 6% to $74.41 a barrel. Gold rose 1.1% to $3,424.89 per ounce.
The FTSE added 0.2% to 8,885 on Thursday, a new record, on strength in energy stocks and cautious optimism over US-China trade talks.
That optimism also saw US stocks close higher, with upbeat earnings from Oracle lending support. The Dow Jones gained 0.2%, the S&P 500 jumped 0.4% and the Nasdaq added 0.2%.
Asian markets are mostly in the red this morning, with Japan's Nikkei down 1.1%, Hong Kong's Hang Seng falling 0.7% and Shanghai's SSE Composite down 0.6%.