- FTSE 100 falls 78 points to 10,379
- BoE policymaker says markets aren't reflecting reality
- Mondi declines 8% on Q1 report
- Brent crude holds above $100
- UK retail sales rise 0.7% in March
4.52pm: Losing day
London stocks finished the week on a sour note, with the FTSE 100 down 78 points at 10,379.
"While US stock indices extend their gains amid solid earnings and hope for a second round of US-Iran talks, European stocks give back recent gains amid persistently high energy costs and as German business confidence hits a six-year low,” IG chief technical analyst Axel Rudolph said.
“After four weeks of falling prices crude has risen by over 10% in the course of this week with Brent oscillating around the $100 per barrel mark.”
4.15pm: Oil still elevated
Oil prices hit their highest in over two weeks earlier, with Brent front-month futures topping $108 a barrel, but they have dropped back to $106 now.
Worries about energy cost inflation and fuel shortage are hitting stock markets around the world.
Meanwhile, another of the market's readings of the Middle East situation is that the FTSE's defence giants are being sold, with Babcock down 4.2% and BAE Systems 3% lower.
Mondi is still the biggest faller, down 10.4% now, with pharma, financials and housebuilders among the bigger fallers.
Investors are also peeking ahead to next week, which looks to be one of the busiest of the quarter, with rate decisions from three major central banks, including the Federal Reserve and Bank of England, and results from five of the Magnificent 7 tech titans.
"Corporate growth appears to be holding up, though investors might want to be on guard for any lag, as higher energy prices and supply chain friction can still show up later in margins," says Joe Mazzola, strategist at Charles Schwab.
"Tech and financials have delivered solid results, but they're less sensitive to energy consumption. The real tell might be industrials, consumer discretionary, and staples."
Today's University of Michigan consumer sentiment index, which measures current economic conditions and consumer expectations, showed a fall this month, down 3.5 to 49.8 points.
3.55pm: Busy week ahead
Next week in the US sees a host of consumer-centered results, including Starbucks, Coca-Cola, Apple and Amazon. Also there's Alphabet, Microsoft, Meta, Visa, Mastercard, Eli Lilly,
For investors focused on FTSE 350 shares, Tuesday sees Anglo American, Barclays, BP, Coca-Cola Europacific Partners, Howden Joinery, Taylor Wimpey, Travis Perkins and WPP.
On Wednesday, there's Aston Martin, AstraZeneca, GSK, Haleon, Lloyds, Melrose, Oakley Capital Investments, PPH Hotel, Prudential, RHI Magnesita and St James's Place.
Thursday brings Alfa Financial Solutions, Beazley, Endeavour Mining, Glencore, Inchcape, International Personal Finance, Lancashire Holdings, Magnum Ice Cream, OSB Group, Persimmon, Standard Chartered, Unilever, Weir Group, Whitbread and ZIGUP.
And the week finishes with NatWest and Pearson.
2.50pm: Intel surge lifts Nasdaq, but Dow falls
It's an uneven start on Wall Street, with the Dow Jones down 0.3%, the S&P 500 up 0.1% and the Nasdaq climbing 0.5%.
Lifting the Nasdaq, Intel shares have soared 25%, AMD 13%, ARM Holdings 11% and Qualcomm 10.3%.
The Dow is in the red, as more than two-thirds of its 30 constituents are down, led by Merck & Co, IBM, Chevron and Honeywell.
2.14pm: Iran minister to visit Pakistan and Russia
Reports suggest Iran's foreign minister will travel this evening to Pakistan and other countries for talks with other regional powers and mediators.
Iran’s semiofficial Mehr news agency said "a round of visits" will be made to Islamabad, Muscat, and Moscow, starting this evening.
“The purpose of this trip is bilateral consultations, discussions about current developments in the region, and also the latest situation of the imposed war by the United States and the Israeli regime against Iran,” the agency said.
Meanwhile, US stock futures are mixed ahead of the opening bell.
While those for the Dow Jones are down 0.1%, Nasdaq futures are up 1.1%, with the S&P 500 seen rising around 0.3%.
This followed a softer finish yesterday and comes with today’s earnings calendar relatively light, putting attention on next week’s heavyweight reports from Microsoft, Alphabet, Amazon, Meta Platforms, Apple and Exxon Mobil.
On the economics calendar, the University of Michigan’s final consumer sentiment index for April is due out today.
1.45pm: UK equity outlook
UK equities have a "supportive backdrop", says UBS equity strategist Matthew Gilman, with valuations at "reasonable" levels, (ie a 13.2x forward P/E versus the median since 1990 of around 12.8x) and earnings forecast to accelerate.
UBS has lifted its UK earnings growth forecast for this year from 5% to 11%, reflecting higher oil and gas prices, but "continue to see robust earnings growth continuing into 2027 with an improving economic outlook, offsetting an expected rollover in oil prices".
By the end of 2026, Gilman and his colleagues have set their target for the FTSE 100 index at 10,500-11,000, which he says reflects higher earnings growth from the energy sector, "but also recognizing idiosyncratic and thematic drivers at a single stock level that have boosted UK equity returns over the past year".
The upside target is 12,000, if global growth improves more rapidly, supported by easy financial conditions and improving consumer and business confidence, weaker sterling boosting the 75-80% of FTSE 100 revenues generated outside the UK, with US investors diversifing into UK assets, helping to close the UK's valuation gap.
A downside scenario would be the FTSE 100 sinking to 7,200 by December as economic weakness materializes, potentially due to an extended period of energy disruption in the Middle East, weighing on growth and delaying US and UK rate cuts that were previously anticipated.
Preferences in for London-listed companies tilt toward "an improving cyclical outlook and secular trends", with consumer discretionary and health care upgraded by the bank's strategists last month, and other attractive sectors including industrials, IT and real estate.
12.48pm: Losses pared
Losses for the FTSE have been cut somewhat, though there is a split in demand for defensive names in the index.
British American Tobacco is top risers, up 3.45%, followed by BT Group and Unilever, with Tesco, Sainsbury, National Grid, Severn Trent also well bid.
At the other end, Mondi shares are down 8.6% now, after its earnings showed firmer sales offset by rising costs.
Medical names are a big drag, with AstraZeneca, Smith & Nephew, ConvaTec all down.
Antofagasta, BAE and Babcock are also among the fallers.
"European stock indices have once again ignored the relative bullishness across US markets," says market analyst David Morrison at Trade Nation, with most of Europe’s majors weaker.
Germany's DAX is the exception, up 0.45%, thanks to gains for SAP after impressing with its earnings.
As things stand, the DAX and other European majors are all on course to post a negative week, Morrison says, while their US counterparts manage to hold near their all-time highs, for now.
"Of course, the war in the Gulf is hitting Europe and the UK harder than the US. The former are reliant on imported energy in a way the US isn’t.
"While the US still must deal with higher crude oil prices, it has few worries over supplies drying up. This is becoming ever more of an issue for as long as the Strait of Hormuz is closed to ‘allied’ shipping.
"As things stand, Iran is only allowing through tankers headed for countries such as India, China, Russia, Iraq and Pakistan. While this has been helpful in keeping some supply on tap, the US blockade of Iranian ports could soon end this traffic."
He says the warning from BoE Deputy Governor Sarah Breeden that stock markets are too high given the risks to the global economy is not helping attract investors today.
11.59am: US objects to UK's digital services tax
Donald Trump has threatened to impose “a big tariff” on the UK if it does not scrap its digital services tax, escalating tensions over the levy on US tech firms.
The 2% tax, introduced in 2020, targets large digital companies including Amazon, Google and Apple.
Downing Street told the Guardian that the policy remains unchanged, despite being a sticking point in UK-US relations and having only been designed to be a temporary measure.
The previous government agreed in 2021 to phase it out, with a global OECD deal having been agreed in 2024, where large multinational companies would pay a minimum 15% corporation tax rate in the countries where they do business, but that has since been delayed by objections from countries including the US, Ireland, Hungary, India and China.
11.25am: UBS likes Chinese AI
Equities have reached new all-time highs in the US and, says UBS, the overall macro backdrop "remains constructive, supported by easing tariff headwinds, expected Fed rate cuts, supportive fiscal policies, and a recovery in manufacturing".
Helping lift Wall Street stocks have been signs of US-Iran de-escalation, which have prompted markets to look past the conflict and refocus on "strong underlying fundamentals, including an ongoing robust earnings season".
The Swiss bank sees structural trends as remaining favourable.
"We recommend maintaining diversified exposure to transformational themes such as AI, Power and resources, and Longevity.
"Within the AI theme, we are taking a more selective approach, focusing on the most attractive opportunities outside US large-cap tech, particularly among Chinese technology companies."
10.40am: IAG loses more altitude
The FTSE 100 has extended its morning losses, now down 81 points at 10,375, with International Consolidated Airlines Group SA (LSE:IAG) adding to the pressure. The British Airways owner is off around 2.5%, tracking weakness across European airline stocks as the sector grapples with mounting disruption.
The catalyst is clear. Rostro analyst Joshua Mahony warned that Asian oil shortages are on their way to European shores, as the last tankers to pass through the Strait of Hormuz before the crisis began approach their destinations. Trump's suggestion that he has "all the time in the world" to resolve the Iran standoff has done little to calm nerves.
Mahony flagged the airline sector as the big-ticket story in Europe right now, with Lufthansa cancelling 20,000 flights - a number he described as likely just the start. "That is likely to be the tip of the iceberg," he said.
What's striking, he noted, is how composed IAG's share price remains - still sitting in the 350-450p range it has occupied for the past ten months. "Is this simply the calm before the storm?" Mahony asked, leaving investors to draw their own conclusions about whether the market has fully priced in what's coming.
10.10am: Small caps under the spotlight
ATOME PLC (AIM:ATOM) has taken a major step forward, declaring a final investment decision on its $665 million Villeta low-carbon fertiliser project in Paraguay after securing the full funding package. The £25.64 million equity raise completes financing alongside $420 million of debt already in place. With a fixed-price construction contract, a 25-year power deal and Yara locked in as offtake partner, first production is targeted for 2029. Read more
Active Energy Group PLC (AIM:AEG, OTCID:AEUSF) has signed a letter of intent with Bitdeer Technologies Group (NASDAQ:BTDR) to develop a joint digital asset mining platform in the Middle East. Active provides the power and infrastructure, Bitdeer brings the mining kit — a capital-light model that gives Active access to equipment worth tens of millions without the upfront bill. The deal supports its push toward a 100MW rollout. Read more
Light Science Technologies Holdings PLC (AIM:LST, FRA:9FD) saw FY25 revenue fall to £8.6 million from £12 million, but that was deliberate - the company ditched lower-margin work to focus on higher-value opportunities, pushing gross margin up to 33.8%. A post-period £6.6 million fundraise funded several acquisitions that CEO Simon Deacon called "transformational," setting the group up for its medium-term target of £50 million in revenue. Read more
Astrid Intelligence PLC (AQSE:ASTR) moved to reassure shareholders after volatility hit the Bittensor ecosystem following a prominent subnet operator's exit and token sell-off. The company said its operations were unaffected: balances, emissions and protocol mechanics all continued normally. Astrid used the episode to highlight Bittensor's decentralised resilience and confirmed its strategy of running validators across multiple subnets and developing its Astrid Arena trading platform remains on track. Read more
Blue Star Capital shares dropped 10% after investee SatoshiPay was caught up in a security exploit on the Hyperbridge protocol, allowing an attacker to mint around 1 billion tokens. Total losses are estimated at $2.5 million, with SatoshiPay's exposure around $250,000. The good news: user funds are safe, and it wasn't SatoshiPay's fault. The company is pressing ahead with a North American payments launch. Read more
Arc Minerals Limited (AIM:ARCM, OTC:ACMNF, FRA:DFYA) shares dropped 12.8% after the company raised £3 million through a placing at a slight discount to fund drilling in Botswana's Kalahari copper belt. The cash will support exploration in the Zone 5 Corridor, with drilling planned for the second half of the year. Directors also converted £1 million of outstanding liabilities into equity, showing confidence in the project ahead. Read more
Manolete Partners PLC (AIM:MANO) shares nudged up 3.5% after the insolvency claims funder reported a stronger second half, with adjusted profit before tax rising to £1.9 million from £0.6 million. Revenue came in at £28 million, broadly as expected. The real standout was the forward book, jumping from £49 million to £67 million - a healthy pipeline as UK insolvencies remain stubbornly elevated. Read more
Record PLC (LSE:REC) ended March with assets under management of $114.6 billion, barely changed from $115.9 billion in December. The company pulled in $1.4 billion of net new money - its third straight quarter of positive inflows - but market movements and currency headwinds cancelled it out. Despite the choppy backdrop, full-year earnings guidance remains unchanged. Read more
Ascent Resources PLC (AIM:AST) has received a boost from its US royalty interest, with partner Neometals publishing a maiden JORC Exploration Target at the Utah Brine Project in Utah. Ascent holds a royalty of 2.5% to 3.5% on future lithium and potassium production - meaning every tonne produced puts money in its pocket. A promising early signal for the asset. Read more
9.35am: BoE sounds the alarm
A senior Bank of England official has raised the prospect of a global stock market correction, in an unusually candid warning that has caught the attention of markets.
Deputy governor for financial stability Sarah Breeden told the BBC that current share prices weren't fully reflecting the economic pressures building in the background - a comment that AJ Bell investment director Russ Mould says may have contributed to some of the FTSE 100's decline.
"It's unusual for a Bank of England official to explicitly warn about a potential stock market pullback," said Mould, noting that Breeden's concerns stretched beyond the Middle East conflict to include private credit risks, high equity valuations and the potential fallout from AI.
Despite the warning, markets have shown surprising resilience - a sign, Mould suggests, that investors believe the war will end quickly and that oil prices, currently around $105 a barrel, will eventually retreat.
But the Bank faces a delicate balancing act on interest rates. A swift resolution to the conflict could make any inflation spike temporary, reducing the need for action. Move too slowly, however, and central banks risk repeating the mistakes of the recent past.
"The wall of worry collapses when fear becomes reality, or investors become too complacent and are caught off guard," Mould warned.
9.15am: More on those movers
Broker upgrades are buoying British American Tobacco and Sainsbury this morning, according to interactive investor's Richard Hunter, with BATS now up 2.5% while Sainsbury is 1.9% to the good - reversing some of the losses following its full-year numbers yesterday.
"In the premier index, packaging firm Mondi led the fallers after a 27% dip in first quarter earnings, due to lower prices and mounting input costs, while the mining sector also tracked lower," Hunter added.
The Footsie has extended its losses, now 55 points down at 10,402.16. On the continent, Frankfurt's DAX is trading 0.14% lower while the Paris CAC 40 is 0.9% weaker.
8.15am: FTSE 100 starts on the back foot
As predicted, the FTSE 100 opened lower, sliding 41 points to 10,416.45 in the first few minutes of trade as the fragile ceasefire in the Middle East keeps investors on their toes.
Mondi PLC (LSE:MNDI) was the biggest faller, down 3.1%, after the paper and packaging giant reported first-quarter results that showed stronger sales volumes largely cancelled out by pricing pressure and rising costs.
Miners were close behind, with Antofagasta PLC (LSE:ANTO), Fresnillo PLC (LSE:FRES) and Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF, FRA:6E2) all sliding more than 2%.
J Sainsbury PLC (LSE:SBRY) topped the leaderboard with a 1.8% gain, while BP PLC (LSE:BP.) and Shell PLC (LSE:SHEL, NYSE:SHEL) both added over 1% on the elevated oil price.
British American Tobacco PLC (LSE:BATS) is also doing well this morning, up 1.5%.
7.55am: Retail sales bounce back
UK retail sales rose 0.7% in March, beating expectations and recovering from a 0.6% fall in February. But analysts were quick to point out that most of the gain came from motorists filling up ahead of rising fuel prices, with petrol sales surging 6.1%. Strip out fuel, and growth was just 0.2%. Clothing and household goods also improved, helping Q1 retail volumes rise 1.6%.
With inflation running at 3.3% and cost-of-living pressures building, economists are divided on whether consumers can keep spending - or whether the bounce will prove short-lived.
"We expect markets to push back expectations for policy easing, keeping front-end yields elevated," commented Lale Akoner, global market analyst at eToro. "UK consumer stocks face downside risk as spending shifts toward essentials, while energy-linked sectors remain supported by higher oil prices. The setup points to a more challenging environment for UK risk assets if growth weakens while inflation stays sticky."
7.15am: Tensions remain elevated
The FTSE 100 is expected to fall further on Friday as oil consolidates above $100 a barrel after US President Donald Trump extended a ceasefire between Israel and Lebaon for a further three weeks and said he won't rush a deal with Iran.
London's blue-chip index has been called 77 points lower in futures markets, after finishing 19 points down at 10,457 yesterday as investors awaited updates on a potential peace deal.
"Geopolitical tensions remain elevated. The ceasefire is holding, but remains fragile," commented Swissquote senior analyst Ipek Ozkardeskaya. "The US Navy reportedly 'boarded a supertanker carrying Iranian oil in the Indian Ocean,' while Donald Trump ordered American forces to shoot boats placing mines in the Strait of Hormuz. Iran, frustrated by Trump’s blockade and public bashing, appears unwilling to return to the negotiating table."
Brent crude futures are up 0.4% this morning at $105.53 a barrel, with Iran saying the Strait of Hormuz cannot be opened due to ceasefire breaches.
"Oil prices are consolidating near the $100 per barrel level," Ozkardeskaya added. "Developed market yields are rising alongside oil prices, fueling inflation expectations, while equities remain hesitant near all-time highs."
Asian markets, meanwhile, are higher as trading draws to a close. Tokyo's Nikkei has gained over 1%, the Hang Seng in Hong Kong is up 0.3%, and the Kospi in Seoul is a few points higher. In Sydney, the ASX 200 closed 7 points lower.