The FTSE 100 sank on Friday after Trump’s decision to extend a deadline for strikes on Iranian power plants failed to steady markets.
London’s leading index had started the session in positive territory, but gains quickly turned to losses, leaving the FTSE 100 0.7% in the red at the time of writing.
Susannah Streeter, chief investment strategist, Wealth Club, said: “Investors are set to stay in a wary mood at the end of a week infused with nervousness about the trajectory of the war in Iran. President Trump has extended the deadline of his ultimatum to Iran, which initially offered respite from the sell-off, but a pessimistic mood has settled back in.”
The FTSE 100 is struggling to stay above 10,000 with sentiment souring and the TACO (Trump always chickens out) trade not having the same impact it had amid last year’s trade war.
Indeed, the Iranian conflict is a very different war that threatens deep repercussions for the global economy and isn’t as easy to remedy as it was to roll back on tariff threats last year. Investors will also be wary of a potential ground invasion with the US moving more troops to the region.
The oil market is having none of Trump’s claims that negotiations with Iran are progressing, and Brent Crude rose to $111 on Friday.
No one knows when the conflict will end. We do, however, know that the longer it rumbles on, the greater the risk to inflation and potential interest rate hikes that curtail economic growth. Consumer spending power is also being eroded, which will filter through to company earnings.
These risks were front and centre on Friday as 90% of the FTSE 100’s constituents traded in the red.
It was a familiar story on Friday, with cyclical and interest-rate-sensitive sectors leading the way lower.
Miners fell as Antofagasta erased all of this year’s gains with another 3% decline. The copper miner has lost around a third of its value since the Middle East war began.
There was more pain for housebuilders. Barratt Redrow fell 2.6% and is now down 31% since the start of 2026. Barratt is the worst-performing FTSE 100 stock of the year. Almost all of this year’s losses were suffered since the US and Israel launched attacks on Iran.
Metlen Energy & Metals was the FTSE 100’s top faller, down 6%, after the group delayed the release of its FY2025 results by nine days.
“In London, the big faller was Metlen Energy & Metals. The Greek company is enduring a bumpy start to life on the London market, having shifted its listing last summer,” said AJ Bell investment director Russ Mould.
“Guidance was cut in February and delaying results is never a good look.”
AstraZeneca was the FTSE 100’s top riser on the back of positive trial results for a chronic obstructive pulmonary disease (COPD) treatment.