The FTSE 100 tumbled on Monday as oil prices soared above $100 to the highest level since 2022, raising fears of interest rate hikes and possible stagflation.

Much of last week’s discussion centered on the implications of an oil price above $100 for the global economy and financial markets. Oil crept higher last week but closed out Friday’s session still some distance from the key psychological level.

However, developments in the Middle East over the weekend meant that traders very quickly found out the impact of oil trading above the $100 mark after Brent oil traded as much as 22% higher in Asian trading overnight.

With oil trading like a penny stock, fear swept through financial markets, sending the FTSE 100 sharply lower on the open as UK 10-year bond yields surged to 4.75%.

The FTSE 100 was down 1.2% at the time of writing after bouncing off the worst levels of the session. The index was down some 190 points in the early minutes of trading on Monday.

Susannah Streeter, Chief Investment Strategist, Wealth Club, said: “Panic has hit equity markets after oil prices rocketed as fears materialised about a big squeeze in global supplies. London’s FTSE 100 has opened sharply lower, after steep falls in Asia, with the Nikkei plummeting 5% and South Korea’s Kospi almost 6% lower, adding to deep losses last week.”

“Crude prices shot up by more than a quarter as trading got underway on oil markets. It’s been the biggest jump since the outbreak of the pandemic, and investors are bracing for an inflation crisis.”

Some of the first signs of the inflation crisis can be found in interest rate derivatives markets, which are now pricing in rate hikes by the Bank of England and the European Central Bank by the end of the year. This is in sharp contrast to just 10 days ago, when investors were trying to work out how many cuts there would be this year.

Potential interest rate hikes sent waves through UK stocks on Monday, with interest rate-sensitive sectors among the heaviest hit.

FTSE 100 housebuilders are the go-to proxy for concerns about interest rates, and Persimmon fell 5% while Barratt and Redrow lost 3%. Traders are now pricing at least one rate hike this year – something the UK property market needs like a hole in the head.

British Land and Segro were both down close to 5%.

The risk of a broader slowdown in economic activity was reflected in mining stocks as investors choose to focus on global growth rather the inflation hedge commodities can sometimes provide. Anglo American was the FTSE 100’s top faller, tumbling 5.3% amid concerns about metal demand.

“One might have expected all types of commodity producers to be in demand if inflation picks up,” said Dan Coatsworth, head of markets at AJ Bell.

“When inflation goes up, investors often seek exposure to hard assets as they tend to retain value better than financial assets in such an environment. However, miners were among the biggest losers on the market on Monday.

Rolls-Royce shares gapped down 6% on the open before recovering to trade 4% lower at the time of writing.

Oil majors BP and Shell provided some balance with gains of between 1%-2%. But this was nowhere near enough to offset losses elsewhere. BAE Systems was also higher.

AIM-listed Phoenix Copper has dismissed its executive chairman, Marcus Edwards-Jones, and chief financial officer, Richard Wilkins, with immediate effect, following an internal investigation into their conduct.

The probe found that approximately $1.765 million in payments were made between 2016 and 2025 to Lloyd Edwards-Jones S.A.S., a corporate finance advisory firm owned by Edwards-Jones. The payments, made by Wilkins in connection with fundraising transactions, were never disclosed to the board or the company’s nominated adviser, despite constituting related party transactions. Wilkins shared in the proceeds.

A further £610,000 in unauthorised payments were also uncovered, some made without board knowledge to an intermediary linked to bond financing, and others made directly against the board’s instructions.

Phoenix said both former directors have indicated a willingness to cooperate with efforts to recover the funds.

Independent non-executive director Catherine Evans has stepped in as interim chair and is working alongside CEO Ryan McDermott to tighten governance and financial controls. An interim CFO has also been appointed to oversee the completion of the 2025 audit.

The company’s auditor, Crowe UK, has been informed. Phoenix said it does not currently expect its historic financial statements to require restatement beyond disclosing the payments as related-party transactions in its 2025 accounts.

Phoenix Copper also provided an update on their finances. The company said its current cash balances will cover obligations only through the end of the second quarter, but discussions with lenders Riverfort and Indigo Capital over existing facilities are ongoing. A further update on fundraising strategy is expected in due course.

Phoenix Copper shares were trading about 2% higher at the time of writing.

There was a spike in trading in Galantas Gold (LON: GAL) shares on Friday. This propelled a 125% gain to 62p. There were 2.91 million shares traded.

Skin treatments developer SkinBioTherapeutics (LON: SBTX) shares rebounded 56.3% to 12.5p following the appointment of Rachel Parsonage as interim chief executive. The share price is still one-fifth lower this year.

RockRose Energy has acquired 2.3% of Deltic Energy (LON: DELT), for which its parent company Viaro Energy has made a recommended offer of 7.46p/share. The deal is dependent on approval by the UK authorities. The share price recovered 50% to 5.25p.

Synergia Energy (LON: SYN) says production from two wells on the Cambay PSC (WI: 50%), onshore India, averaged 78 barrels of oil/day in February and so far in March it has increased to 195 barrels of oil/day. The C-77H gas well is producing around 500,000 scf/day. The share price rose 42.9% to 0.01p.

FALLERS

General Motors has informed Surface Transforms (LON: SCE) that is re-sourcing supply of brake discs. This contract generated £15.3m in 2025, which was 84% of group revenues. The contract was expected to last until 2030. General Motors has provided advanced payments and financial support of £14.4m. The company has not yet spoken directly to General Motors. The contract loss is a major blow and Surface Transforms will employ corporate restructuring advisers. The share price slumped 93.8% to 0.125p.

FRP Advisory has been appointed as administrator of video streaming technology group Aferian (LON: AFRN) and it has sold the subsidiaries of the company to Sapphire Technology Group for $1.3m, plus $700,000 of deferred consideration payable in January 2027 if the annual revenues of the subsidiaries are at least $30.6m and annual recurring revenues are greater than $8.9m. The outstanding debt of Aferian is $16.5m. The share price slid 35.3% to 0.55p.

Alba Mineral Resources (LON: ALBA) addressed rumours that earn-in rights for the Finnsbo project in Sweden have been terminated. Alba says it has fulfilled its obligations under the deal. Alba recently raised £800,000 at 0.02p/share and some of the cash will fund completion of the assay programme at the Finnsbo gold copper rare earths project in Sweden. Alba says that it has earned its 25% stake and further spending will increase this to 51%. The cash will also fund drilling at the Clogau gold mine and processing of ore, as well as upgrading the processing plant, and an updated mineral resource for the Motzfeldt critical metals project in Greenland. The share price fell 30.8% to 0.018p.

Central Asia Metals (LON: CAML) says the estimated life of its Sasa zinc and lead mine in North Macedonia is up until 2034 and this five year reduction of the mine life will lead to a non-cash impairment charge of up to $120m. The ore body has become more variable and knocked profitability. Exploration may help to extend the mine life. The company says that its dividend policy will not change. There was more than $80m in cash at the end of 2025. Full year results will be published on 19 March. The share price declined 26.4% to 176.2p.

With the war in the Middle East showing no sign of resolution, the FTSE 100 gave up early gains on Friday as surging oil prices stoked inflation fears.

As we saw yesterday, early FTSE 100 gains can very quickly turn to losses, and the index fell from highs of 10,476 to 10,358 at the time of writing on Friday.

The path forward is becoming increasingly difficult to plot for traders, with so many moving parts in the Middle East that could prolong the conflict for many weeks and filter through into inflation and central bank thinking. 

We entered 2026 expecting a series of interest rate cuts throughout the year, starting in Q1. But with Brent Crude trading above $88 on Friday, rate cuts are firmly off the table.

Indeed, the war in the Middle East now means there are talks of potential rate hikes as the oil crisis takes hold, and this has been reflected in equity markets this week. 

As of the time of writing, the FTSE 100 is down around 5% from last week’s record high at 10,910. This isn’t a huge move in the grand scheme of things, and many may see it as a healthy reset after surging gains. 

Whether this turns into a 10% correction hinges on the perceived length of the Iran conflict and how freely oil will flow out of the region.  While these remain unknown, we can expect equity markets to remain choppy, trading on a headline-to-headline basis.

Most FTSE 100 stocks were down again on Friday, driven by the familiar pattern of cyclical sectors leading the way lower. Retailers, banks, and miners all dragged on the index.

Kingfisher was the top faller, down 3%, as inflationary pressures prompted investors to sell. Housebuilders Persimmon and Berkeley Homes were down between 2% – 3%.

Paradoxically, Rightmove was the top riser on the back of Halifax house price data showing the average UK house price was 1.3% higher than a year ago.

IMI

IMI was the top pick of the corporate updates on Friday. Full-year results were strong, with steady growth and rising profits. Investors will also be pleased with a fresh £500m buyback. Shares were 2% higher at the time of writing.

“If there’s one area where the UK market has a surfeit of high-class operators it is complex engineering and one of these names, IMI, topped the list of FTSE 100 gainers thanks to its latest results,” said AJ Bell investment director Russ Mould.

“The company makes valves, actuators, and control systems for the control of steam and fluids and serves a variety of sectors including healthcare, energy and climate control.

“A 5% increase in organic revenue translating into an 8% increase in operating profit tells a story of improved profitability and there was an impressive uplift in cash generation.

“Management demonstrated their confidence in what looks to be a solid outlook, with a generous buyback announced alongside a meaningful increase in the dividend.”

Synergia Energy (LON: SYN) says production from two wells on the Cambay PSC (WI: 50%), onshore India, averaged 78 barrels of oil/day in February and so far in March it has increased to 195 barrels of oil/day. The C-77H gas well is producing around 500,000 scf/day. The share price jumped 28.6% to 0.009p.

Quantum Blockchain Technologies (LON: QBT) has had a busy week. It has delivered its first Bitcoin mining rig to one of its three ASIC manufacturers that is a potential partner. The company is working on implementing the software version of Method C AI Oracle into the rig’s operating system. This follows progress with patent applications. Discussions have been held with interested parties at the Nashville Energy & Mining Summit in late January. The share price recovered 21.2% to 0.515p.

Beacon Energy (LON: BCE) has been readmitted to AIM following the purchase of a 48% stake in Italian gas projects developer LN Energy, which holds 90% of the Colle Santo field in onshore Italy. The field has 2P gas reserves of 12mmboe and could start producing within 18 months. The rise in gas prices makes the field potentially even more strongly cash generative. This will cost $30m and be funded by debt. Beacon Energy has raised £3.75m at 3.9p/share. The share priced returned up 12.8% to 4.4p.

Adam Kaye, director of cinemas operator Everyman Media (LON: EMAN), bought two million shares at 24.5p each. He has a 8.17% stake. The share price improved 8.16% to 26.5p.

Shares in Rosebank Industries (LON: ROSE) have returned from suspension 3.35% higher at 339p after it published the readmission document for its latest acquisition. Rosebank Industries is making its second major acquisition less than two years after joining AIM. It is paying $3.05bn (£2.28bn) on a debt free basis for ASP MWI, which has two businesses. MW Components is a provider of bespoke fasteners, springs and metal components, while CPM manufactures processing equipment used in oilseed, animal feed, renewable energy and industrial materials sectors. A placing raised £1.9bn at 330p/share, while a retail offer generated £7.7m and directors are subscribing for £12.3m for shares. The previous acquisition was funded at 300p/share.

FALLERS

Alba Mineral Resources (LON: ALBA) addressed rumours that earn-in rights for the Finnsbro project in Sweden have been terminated. Alba says it has fulfilled its obligations under the deal. Alba recently raised £800,000 at 0.02p/share and some of the cash will fund completion of the assay programme at the Finnsbo gold copper rare earths project in Sweden. Alba says that it has earned its 255 stake and further spending will increase this to 51%. Alba says it will ensure its rights are recognised. The share price slipped 10.3% to 0.0175p.

Malawi focused rare earths and graphite miner Sovereign Metals (LON: SVML) used $20.4m of cash in operating activities in the six months to December 2025. It still had cash of $33.9m. the cash was spent completing the DFS on the Kasiya project. The share price initially fell to 47.5p, but it is currently 1% lower at 48.5p.