The FTSE 100 was weaker on Thursday, with the focus firmly on rising tensions in the Middle East and political instability in the UK.
Markets were driven by the familiar concerns around oil prices, inflation and what the next UK Prime Minister will do to the UK economy on Thursday. The FTSE 100 was down 0.4% at the time of writing as a result.
A sharp rally in oil prices in the midmorning trade on Thursday weighed on equities after Brent surged $3 in a matter of minutes, trading at $107 heading into the afternoon session.
Global equities have shown a degree of resilience during the extended period of posturing by the US and Iran, but this is starting to fray as the prospect of a hiking cycle to manage inflation becomes real.
“There’s a realisation that even if the Strait of Hormuz were to fully reopen next week, supply snarl-ups will continue for many months,” explained Susannah Streeter, chief investment strategist, Wealth Club.
“Extensive damage to facilities will take much longer to repair, with Abu Dhabi National Oil Company warning that a full recovery in flows of oil is unlikely before late next year.”
Investors were also digesting Nvidia earnings. The chipmaker beat expectations, but there was some nervousness about guidance, and shares slipped in the premarket before rebounding to trade flat at the time of writing. US futures were lower as global stocks moved lower in unison on Thursday.
Fresnillo and Endeavour Mining were among the worst performers of the day as gold prices slipped.
Autotrader was the FTSE 100’s top faller, as full-year profits missed expectations. Shares were down 8% at the time of writing.
Some positivity could be found in ICG Group, which posted a 13% increase in management fees and 11% increase in assets under management. ICG Group was the top riser, gaining 3%.