The FTSE 100 whipsawed on Friday as investors were pulled pillar to post by mixed comments on the targeting of energy assets in the Middle East conflict.
It appears Donald Trump has drawn a red line in the conflict by telling Israel not to attack oil assets as energy prices soar and threaten a period of inflation in the key mid-term election year.
Trump’s instruction was largely seen as positive by equity investors who bid stock markets up on the open. But conditions remain choppy as traders weighed Iran’s response, which suggested it would continue to disrupt oil production in the region.
The net result of whipsawing trade on Friday morning was a FTSE 100 trading 0.1% higher at 10,081 shortly after midday. Brent Crude was marginally lower at $107.36.
Susannah Streeter, Chief Investment Strategist, Wealth Club, explained that markets were calmer on Friday, “but fears remain elevated about how economies will respond to an inflation shock sparked by rampant energy prices. A high degree of caution is set to dominate sentiment at the end of the week, as the trajectory of the conflict with Iran remains highly uncertain.”
The 10,000 level remains support after bouncing off the key psychological level yesterday and again on Friday. Technical analysts will keep a close eye on trading to see whether the revisiting of 10,000 on Friday proves to be a double-bottom formation.
There was an element of bargain hunting on Friday, with heavily hit names such as Entain, Easyjet, and JD Sports among the top risers. Entain was the best performer, adding 3%.
Easyjet and Entain are two of the top three fallers of 2026 so far, both down around 29%. The biggest decliner is Barratt Redrow, down 30% YTD after being ravaged by interest-rate concerns.
Unilever shares rose 1% on Friday after it responded to media speculation and confirmed it had received an offer for its foods business.
Dan Coatsworth, head of markets at AJ Bell, said: “Brace yourself for Marmite-flavoured hot sauce after Unilever confirmed bid interest from Cholula maker McCormick for its food brands.
“McCormick is no stranger to acquisitions, having made a steady stream of them over the years including the purchase of Reckitt’s food arm which included French’s mustard and Frank’s RedHot sauce. Its M&A track record isn’t entirely perfect though. It tried and failed to buy Mr Kipling maker Premier Foods 10 years ago after the target’s board rejected numerous bids.”
“There is a real chance that McCormick might not want Marmite longer term. While it is a quintessential brand in the UK, the love it or hate it spread is more of a niche product outside the UK, Australia and South Africa, and it wouldn’t fit naturally in McCormick’s portfolio.”
Smith Group was the FTSE 100’s top faller, losing 7%, after reealing disappointing results.
“Smiths Group posted, for the most part, a resilient first-half performance this morning as it pushes ahead with its portfolio transformation, but shares fell 4.5% at the open after the company trimmed full-year guidance,” said Adam Vettese, market analyst for eToro.
“Organic revenue rose less than expected and was forecast at 3-4% going forward. The 5.4% dividend hike seemingly not sufficient to offset this for investors this morning. There is also no indication about potential adverse effects of prolonged geopolitical disruption.”