- FTSE 100 falls 48 points to 10,305
- Oil prices spike above $100 overnight before easing a little
- On The Beach pulls guidance due to Iran war spillover
5.15pm: Another losing session
The FTSE finished Thursday down 48 points at 10,305, with equities under pressure amid fresh strength in oil prices.
“It remains the case, so long as the US and Iran are at each other’s throats, that equity markets will remain under pressure,” IG chief market analyst Chris Beauchamp said.
“Oil prices are up by double-digit percentages again today, as the realisation sinks in that the US is not about to either end the war or institute some kind of convoy system in the region. Traders continue to take each bounce as an excuse to sell equities, and are buying oil on weakness.”
4.06pm: FTSE off worst levels
The FTSE was sitting at over a 90-point deficit in the past hour but has picked itself up a bit.
Banks and financials led the fallers, with HSBC down after its shares went ex-dividend and having its Middle East exposure flagged in a broker note.
Barclays, Standard Chartered, Lloyds and NatWest all slid 2-5%, amidst reports about office workers being asked to work from home at many banks in Dubai and other Gulf financial centres.
Cyclicals also came under pressure, including housebuilders Persimmon and Barratt Redrow as interest rate hopes dim and the RICS report indicated a gloomier mood in the house market.
Consumer-linked names weakened as well, with Diageo, IAG, easyJet, Kingfisher, and betting group Entain, though names like Schroders, Anglo American, Endeavour Mining, LondonMetric Property, Entain and Tritax Big Box REIT were all ex-divs.
The leaderboard is topped by Rentokil Initial after being upgraded by UBS,
Next are defence contractor BAE Systems, and oil producer BP as the conflict continued to rage in the Gulf.
Utilities SSE, Centrica and National Grid were all higher too.
3.40pm: Central bank previews
Lots of economists are looking ahead to next Thursday's ECB and Bank of England meetings.
Barclays and Deutsche Bank thinks it is highly unlikely ECB changes policy on 19 March.
Barclays says the ECB is "set to hold rates but shift tone in light of upside inflation risks from the Middle East conflict.
"For now, this calls for vigilance but the ECB will likely emphasise an agile reaction function should the shock persist."
ECB policymakers in recent days have been warning that they are not willing to repeat the mistake made during the Ukrainian energy crisis, meaning they could act sooner rather than later to prevent inflation from rising on the back of higher energy prices.
Deutsche says the market will focus on what the ECB communications imply about the path forward. "The ECB is ready and willing to act to avoid a repeat of the 2022-2023 inflation shock. Saying this loudly and clearly might be the best way of ensuring that inflation expectations remain well anchored."
It's a similar story for the BoE's Monetary Policy Committee, as the Gulf conflict throws the inflation outlook into disarray and forces policymakers to tear up their plans for further cuts.
"Normally, we’d expect the Bank of England (BoE) to look through an energy price shock. However, given inflation has been above target for five years and inflation expectations are still elevated, it probably doesn’t have that luxury," says Thomas Pugh at RSM.
The MPC is also acutely aware of its reputation, like the ECB, after being widely criticised for moving too slowly when energy prices surged following Russia's invasion of Ukraine in 2022.
"If energy prices and, crucially, futures curves stay around current levels, then we think interest rates will be on hold for the rest of this year before falling in 2027," says Pugh.
More thoughts from other economists here, but in short, no cuts for the foreseeable.
3pm: UK and other European nations mull options to support Gulf shipping
UK defence secretary John Healey says possible options are being examined to help defend shipping in the Strait of Hormuz from Iranian attacks.
Following talks with European counterparts, he said he has asked the MoD to look at what the UK could do to protect commercial tankers, potentially including autonomous vessels that can counter mines.
"Recognising the huge impact this potentially has on oil prices and the cost of living, there is an international imperative to try and see this resolved," Healey told reporters.
Already in the region are some autonomous mine hunting systems, he said after meeting with commanders in London.
"I have been talking to planners today about additional options we can bring to bear alongside allies should it be needed."
1.42pm: Oil up, stocks down
Oil prices are climbing again and equities are falling.
A likely catalyst is Iran's new Supreme Leader Khameni Jnr saying the Strait of Hormuz "should stay closed".
Front-month Brent crude is back up above $99 a barrel, with US WTI above $94.
Data from prediction platform Polymarket showed an 80% probability that NYMEX crude oil futures will hit $100 by 31 March, with a 57% chance of reaching $110 and a 44% chance of $120. That has risen from earlier.
Meanwhile, US stocks opened lower, with the Dow Jones dropping around 500 points or 1.05% in initial trades.
The S&P 500 and the Nasdaq are both down 0.75%.
1.13pm: Banks scaling back Gulf office attendence
Several major banks are taking small measures to protect staff in the Gulf, newswire reports are revealing, as security concerns rise due to the strikes on Iran and its retaliatory attacks.
The moves follow warnings from Iran’s joint military command that banks and financial institutions could become targets after a reported strike linked to Bank Sepah.
Standard Chartered has begun evacuating staff from its Dubai offices and asked employees to work from home, while Citi told staff to leave buildings in Dubai’s financial district.
JPMorgan has also moved Middle East staff to remote working, though it said client services remain unaffected.
Meanwhile HSBC has closed all branches in Qatar until further notice to protect staff and customers.
12.06pm: Europe mixed as Wall Street futures point lower
European markets are still generally subdued at midday, with the FTSE 100 the laggard with a 0.4% decline, partly distorted by the heavy ex-dividend drag from HSBC.
Frankfurt's DAX is bucking the trend, nudging up 0.1%, while Paris's CAC 40 down 0.2%, Milan's FTSE MIB down 0.45% and Madrid's IBEX 35 leading the losses, down 0.75%.
Wall Street is pointing lower ahead of the open, though US futures have pulled back from their worst levels of the morning.
The Dow Jones is down 0.6%, the S&P 500 and Nasdaq futures are both off 0.5%.
Kenny Polcari, market strategist at Slatestone Wealth, says Wall Street is catching up with overnight escalation, as Iran expanded its retaliation across the Gulf region, launching strikes toward targets in Dubai and Kuwait, "raising fears that the conflict may now be spreading beyond military targets and toward economic infrastructure".
On the mood, he said: "Today we are forced to process energy risk, food supply risk, and geopolitical escalation all at the same time – the result is exactly what we are seeing this morning: a broad risk-off tone across global markets."
"If there's one thing markets hate more than anything else – it's uncertainty."
11.58am: HSBC and Stan Chart most Mid-East exposued among European banks
There's an extra reason why HSBC is the biggest faller today: a note from JP Morgan stress-testing European banks against the Middle East conflict.
Analyst Kian Abouhossein calculated that HSBC and Standard Chartered are the two London-listed topping the exposure league, with the region accounting for 4% and 12% of pre-tax profit, respectively.
Earnings are vulnerable, he reckons.
On the plus side, he sees both banks as standing to benefit from the surge in market volatility, as corporate clients rush to hedge their exposure to swinging oil prices and currencies, generating fees for investment banking and trading desks.
Another silver lining: volatile markets mean bumper hedging fees, and long-term, Abouhossein sees Hong Kong as quietly picking up the pieces.
11.11am: Half and half
Just over half the FTSE 100 companies are in green, though the index is down.
Eleven of the top 20 largest names are in the red, with HSBC going ex-dividend, with its shares down over 5%.
Stan Chart are down 1.9% and Lloyds and Barclays are both down 1% too.
"Another downbeat start to the day in Europe, as traders weigh up the consequences of a fresh surge in energy prices," is the summary from market analyst Josh Mahony at Scope Markets.
"Notably, we are seeing gains almost entirely across the board for commodities, with softs, metals, and energy all moving higher together.
"Nonetheless, the fear of stagflation does remain prevalent right now, with the banks being hit hard on the prospect of dimming economic growth forecasts."
Yesterday’s 400 million barrel release from the IEA is "doing little" to stifle the rise in crude prices, while President Trump’s claim that we could soon see a resolution to the conflict "does provide hesitancy for the bulls, the reality of the situation will undoubtedly call for higher prices as the days roll on".
He notes reports that Indian flagged tankers may be allowed passage through the Straits, offering some relief, with negotiations ongoing in a bid to secure the transit of over 20 vessels.
"Nonetheless, with Iran seemingly ramping up attacks on both land and waterborne energy targets, the fallout for global energy supplies does appear to be worsening by the day."
Trump has turned his attention back to global trade, with his administration launching two trade investigations into excess capacity for 16 trade partners, including the EU, China, Japan, India, Korea, Mexico and Norway.
"Coming hot off the heels of a Supreme Court decision that struck down his prior country-specific tariffs, this appears to be a fresh bid to reinstate levies under the ‘section 301’ investigation of unfair trade practices."
10.34am: Ship attacks in Strait of Hormuz
The current lead photo is from the Royal Thai Navy, which said this morning that it is "monitoring the situation" of a Thai cargo ship attacked near the Strait of Hormuz and coordinating rescue efforts for the 23 Thai crew members.
กองทัพเรือติดตามสถานการณ์เรือสินค้าไทยถูกโจมตีใกล้ช่องแคบฮอร์มุซ เร่งประสานช่วยเหลือลูกเรือไทย 23 คน
พลเรือตรี ปารัช รัตนไชยพันธ์ โฆษกกองทัพเรือ เปิดเผยว่า วันนี้ (11 มีนาคม 2569) ศูนย์ควบคุมการจราจรทางทะเล ของศูนย์ปฏิบัติการกองทัพเรือ (ศคจร.ศปก.ทร.)… pic.twitter.com/vVzbgMoD8I
— กองทัพเรือ ROYAL THAI NAVY (@prroyalthainavy) March 12, 2026
10.22am: Risers and fallers
Some movers (though obviously the wider market is down, so a part of all these is the 'sinking tide' effect).
Computacenter shares have dropped 5.8% after full-year results met but did not exceed expectations, with investors finding little in the numbers to justify a re-rating of a stock that has already run hard.
TP ICAP rose 5.7% after reporting a strong set of full-year results and announcing a fresh £80 million share buyback.
Trainline is down 4% after its full-year trading update was broadly in line with expectations.
9.36am: Gas and electric prices spike
The Office for National Statistics has put out its economic activity and social change "real-time indicators".
This release provides early experimental data and analysis on economic activity and social change in the UK, faster indicators are created using rapid response surveys, novel data sources and experimental methods.
Wholesale energy prices have understandably increased in response to recent events in the Middle East, with the system average price of gas increasing 68% to 4.477 per kWh last week, compared with the previous week ending at 2.67 p/kWh.
The system price of electricity increased 74% from 6.430 p/kWh to 11.170 p/kWh over the same period.
These were based on data from the National Gas Transmission and Elexon.
Shoppers' behaviour slowed last week, with UK retail footfall decreasing 1% week-to-week, according to BT Active Intelligence, and total Revolut debit card spending down 2%.
Retail footfall further decreased 5% when compared to a year ago, while debit card spending increased by 13% over the same period.
The number of UK flights increased 5% last week, compared with the previous week, but was broadly unchanged when compared with the equivalent week of 2025.
9.18am: IEA warns of largest oil supply disruption in history
The International Energy Agency (IEA) has warned that the Middle East war is causing the largest supply disruption in the history of the global oil market, with flows through the Strait of Hormuz falling to a trickle.
Gulf producers have cut output by at least 10 million barrels per day as storage fills up and tankers are unable or unwilling to load cargoes, the IEA said in its March report, with major reductions recorded in Saudi Arabia, Iraq, Kuwait, the UAE and Qatar.
Global oil supply is projected to fall by 8 million barrels per day in March alone.
Brent crude, the international oil benchmark, has surged from just over $72 to around $98 a barrel since the US and Israel launched joint air strikes on Iran at the end of last month, touching nearly $120 a barrel earlier this week.
In response, IEA member countries agreed yesterday to release an unprecedented 400 million barrels from emergency reserves to help stabilise markets, though the agency cautioned this remained a "stop-gap measure" without a swift resolution to the conflict.
The IEA also trimmed its forecast for global oil demand growth in 2026 by 210,000 barrels per day to 640,000 barrels per day, citing flight cancellations, disrupted liquefied petroleum gas supplies and the broader economic impact of higher prices.
8.50am: On The Beach bummed out
On The Beach shares have dropped almost 13% after the online travel specialist withdrew its guidance.
Analyst Anna Barnfather at Panmure Liberum notes that the shares were already down 1.6% over the last month and 15.7% in the year to date as worries about a slowdown in international travel intensified as the conflict in the Middle East stepped up.
But she remains supportive, saying: "We believe the company is well placed to remain profitable this year but will likely experience subdued demand and higher cancellations while the conflict continues."
The shares are now down around 24% YTD and about 44% compared to last summer.
8.27am: BoE 50/50 to hike rates this year
Bank of England predictions have swung violently this week.
This morning, UK futures rates are pricing about a 54% chance of the BoE's monetary policy committee raising the base rate by a quarter of a percent by the end of the 2026, as traders envision the possibility of breakout inflation resulting from the Iran war.
Compare that to the end of last month, when the bets were between one rate cut or two rate cuts.
Sterling is down 0.2% versus the US dollar at 1.3383, but roughly flat versus the euro at £0.8628.
"EUR/GBP continues to show a negative correlation to oil prices, in our view, primarily on the back of the notion that the UK has had a bigger inflation problem and the Bank of England’s policy is set to be affected by energy prices more deeply," says ING currency analyst Francesco Pesole.
"Our concern remains that markets have priced out BoE easing too aggressively," he says, the two-year GBP swap rate having jumped 50 basis points since the Iran conflict started.
If there are positive surprises on Middle East de-escalation, this could results in "meaningful EUR/GBP upside risk", Pesole says.
8.17am: FTSE 100 opens lower, ex-divs add weight
The FTSE 100 has opened 61 points lower at just below 10,292 as airlines, housebuilders and consumer stocks lead the fallers.
HSBC is the biggest faller, as it is one of a cabal of blue-chips going ex-dividend this morning, meaning buyers from today are no longer entitled to the latest declared payout.
Other ex-divs include, by order of their index impact, Schroders, Anglo American, Endeavour Mining, LondonMetric Property, Entain and Tritax Big Box REIT.
The news from On The Beach has hit easyJet, while the RICS report has knocked confidence in housebuilders, with Persimmon down 2% and Barratt Redrow slipping 1.1%.
8am: Off The Beach
On the Beach has pulled its full-year profit guidance due to the conflict in the Middle East, which triggered a sharp slowdown in bookings to some of its most popular destinations, including Turkey, Greece, Cyprus and Egypt.
The online travel company, which had been targeting adjusted pre-tax profit of between £39-43 million, said the timing of any recovery in demand remained too uncertain to maintain that guidance.
It comes despite what had been a strong start to the year, with a record trading day on 1 February and second-quarter departure volumes up 34% year on year. Bookings in the first half of the financial year were up 10%.
7.45am: Trainline on track
Trainline has revealed it is on track to hit its full-year targets, though growth slowed slightly in the second half of its financial year to end-Feb.
In a post-close trading update, the digital ticketing group said net ticket sales choo-choo-chooed 7% higher to £6.3 billion, with revenue up 2% to £453 million. This compares to 8% and 2% ticket and revenue growth at the half-year stage.
CEO Jody Ford, whose gave notice of his departure last month, called it a "robust trading performance" and hailed strong cash generation.
7.24am: UK housing market confidence fragile
The UK housing market going nowhere fast, according to the latest RICS survey, with buyer demand slipping further in February.
Surveying the surveyors found a net balance of new enquiries falling to -26% from -15% in January, as worries about inflation and interest rates made would-be buyers think twice, while agreed sales remained soft at -12%.
Short-term price expectations turned more negative, reflecting worries about the Middle East conflict.
RICS notes "downward momentum in confidence since the Iran conflict began", with several respondents naming it directly.
Head of market research Tarrant Parsons says: “February’s survey highlights renewed volatility in the market. While activity indicators at the start of the year suggested a tentative improvement, the deterioration in the geopolitical backdrop has clearly weighed on confidence. The recent rise in oil and energy prices has also increased the likelihood that mortgage rates will remain higher for longer."
Recall the news from Moneyfacts yesterday that the average mortgage rate has risen above 5%, with 472 residential mortgage products withdrawn from the market this week.
7.16am: FTSE to start lower as oil prices surge again
The FTSE 100 is likely to start lower on Thursday, as the war in the Middle East sends oil prices surging again.
Futures for London's blue-chip index indicate a fall of around 10 points, a day after dropping almost 50 points to close at 10,353.77.
US stocks had a broadly flattish session overnight, with the S&P 500 finishing only around six points in the red, down 0.08%, while the Nasdaq ended up 0.08%, with the Dow Jones sliding 0.6%.
Asian markets are lower this morning, with the Japan’s Nikkei falling 1%, while Hong Kong’s Hang Seng has dropped 0.9% and China’s Shanghai Composite edged 0.1% lower.
While market indices may finish flat, there is generally a tug of war between risers and fallers, with volatility showing "no sign of easing", says market strategist Henry Allen at Deutsche Bank.
Brent crude oil jumped back to $100 a barrel overnight, but has eased to just under $97.
"The main catalyst for that has been further attacks on shipping, with two tankers and a container vessel struck in the Gulf this morning," says Allen.
Reports overnight suggest Oman has evacuated ships from its main export terminal.
"From a market perspective, the problem is that investors are increasingly pricing in a more protracted conflict that causes extensive economic damage," Allen explains, with more forward-facing Brent futures rising. "After all, with no concrete signs of de-escalation yet, that’s keeping oil prices elevated, and raising the risk of a broader stagflationary shock."