Report Line
FTSE 100 falls to 10,782 Brent crude approaches US$100 BP gains as oil rises Computacenter extends Tuesday’s advance 9.00 am: FTSE recovers ground but oil concerns persist The FTSE 100 recouped part of its opening loss but remained 0.27% lower at 10,782.52 shortly before 9 am. The index had stood at 10,765.07 at market open and was nearly 38 points above its early low of 10,744.65. Brent crude approached US$100 a barrel as escalating US-Iran hostilities and attacks on Saudi energy facilities raised fears of further supply disruption.
BP gained 1.8%, although concerns that higher energy costs could prolong inflation continued to weigh on the wider market. Sterling’s rise to around US$1.356 provided another headwind for internationally focused companies. The FTSE 250 declined 0.14%, while the AIM All-Share edged 0.07% higher.
Computacenter led the blue-chip risers with a 3.2% gain, extending its advance following Tuesday’s results. Aberdeen rose 2.3%, followed by BP, Centrica and SSE. 8.00 am: FTSE falls despite renewed commodity strength The FTSE 100 opened sharply lower on Wednesday as a stronger pound and renewed inflation concerns outweighed support from rising commodity prices. London’s blue-chip index was down 46.59 points, or 0.43%, at 10,765.07 shortly after 8am.
It traded between 10,744.65 and 10,768.07 during the opening minutes. Sterling strengthened 0.15% to US$1.3560, close to its early high of US$1.3563. A firmer pound can weigh on the internationally focused FTSE 100 by reducing the sterling value of overseas earnings.
Oil prices moved higher, with Brent crude climbing 1.52% to US$99.41 a barrel and West Texas Intermediate gaining 1.19% to US$94.14. The advance towards US$100 may support BP and Shell, but it also raises concerns that higher energy costs will add to inflation and keep interest rates elevated for longer. Gold edged 0.14% higher to US$4,445.19 an ounce, while silver gained 0.42% to US$67.28.
Copper was virtually unchanged at US$6.7768 per pound, remaining close to recent record levels. The opening decline suggests investors are focusing on the potential inflationary consequences of higher oil prices and the headwind from sterling, with commodity strength so far proving insufficient to lift the wider index. 7.00 am: Surging oil prices unsettle global markets The FTSE 100 is expected to open sharply lower as Brent crude’s advance towards US$100 a barrel fuels concerns about inflation and interest rates. IG expects London’s blue-chip index to fall approximately 51 points, or 0.5%, to 10,760.
The benchmark closed Tuesday down 10 points at 10,811.66. Brent crude traded around $99.01 a barrel after briefly approaching $99.70, following US strikes near Iran’s Kharg Island and attacks on Saudi Arabian energy facilities. The escalating threat to Middle Eastern supplies pushed West Texas Intermediate above US$95 and weighed on global equities.
Higher oil prices could support BP and Shell but are likely to pressure airlines, retailers and other energy-intensive businesses. Wall Street finished firmly lower as investors considered the inflationary consequences of the oil rally. The Dow Jones Industrial Average dropped 1.2%, the S&P 500 declined 0.6%, and the Nasdaq Composite lost 0.3%.
US market close Government bond yields remained elevated. The US 10-year Treasury yield stood around 4.79%, while concerns about Britain’s public finances persisted after the UK sold a 30-year gilt at a record yield of 5.8168%. Copper provided a potential counterweight for London’s miners after three-month prices reached a record $14,728 a tonne.
The rally has been driven by supply disruptions, declining mine output, tariff uncertainty and growing demand from electricity grids and artificial intelligence infrastructure. Asian markets were mixed. Japan’s Nikkei 225 declined 0.3%, the Shanghai Composite slipped 0.1% and Hong Kong’s Hang Seng fell 0.5%, while South Korean shares advanced.
Australia’s S&P/ASX 200 was marginally lower. Sterling remained firm at approximately $1.3551, creating an additional headwind for the internationally focused FTSE 100 by reducing the translated value of overseas earnings. Gold retreated to around $4,394 an ounce, while Bitcoin traded near $79,050.
Energean, Gym Group and WAG Payment Solutions are scheduled to publish half-year results, while Frontier Developments and Pan African Resources are due to release full-year figures
Source: Proactive Investors
