𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Stocks plummeted on Wednesday as tensions flared in the Middle East with the US threatening further attacks on Iran.

The FTSE 100 closed down 176.84 points, 1.7%, at 10,489.04, and the FTSE 250 ended down 361.18 points, 1.5%, at 23,017.64, while the AIM All-Share fell 11.11 points, 1.4%, to 758.07.

Oil prices jumped and stocks slumped after US President Donald Trump said the ceasefire with Iran was “over” as fighting flared, sparked by Iranian attacks on ships in the vital Strait of Hormuz.

Tehran insists on controlling the key shipping route, saying it will charge fees for passage and threatening to hit vessels that deviate from its authorised route.

Iran’s military has struck at least three ships in recent days, prompting extensive US strikes against Iranian targets followed by retaliatory attacks from Iran on Gulf countries.

“As far as I’m concerned, it’s over,” Mr Trump said at a Nato summit in Turkey on Wednesday when asked if the truce was intact.

“It’s just a waste of time dealing with them,” he added.

In response, Brent crude for September delivery traded higher at 80.00 dollars a barrel on Wednesday, up from 73.88 on Tuesday.

Stephen Innes at SPI Asset Management said: “The risk now is escalation by inches. Not a single thunderclap that announces a new war, but a series of ‘necessary’ responses, each one defensible on its own, each one pushing the region closer to the edge.

“That is how war premiums are rebuilt. Not always with a trumpet blast.”

The spike in crude prices boosted energy stocks. BP led a handful of FTSE 100 risers, rising 3.5%, while Shell added 2.3%.

In contrast, airline stocks came under selling pressure as investors fretted about higher fuel costs and the potential for further disruption to Middle East air travel.

British Airways owner IAG fell 4.8%, while on the FTSE 250 Wizz Air lost 5.0%.

In European equity markets on Wednesday, the Cac 40 in Paris ended down 2.2%, as did the Dax 40 in Frankfurt.

In New York, the Dow Jones Industrial Average was down 1.6% and the S&P 500 was 1.1% lower as was the Nasdaq Composite.

In the UK, there was some moderately encouraging news on the jobs market and inflation outlook.

Figures showed the decline in permanent hiring eased notably in June, while growth in temporary placements reached its strongest level in more than three years.

The latest KPMG and Recruitment & Employment Confederation jobs report compiled by S&P Global showed the permanent placements index climbed to 49.1 points from 44.1 in May, moving closer to the neutral 50-point threshold.

Elsewhere, the International Monetary Fund said UK inflation is set to ease back to target levels quicker than previously expected.

The IMF’s latest update to its World Economic Outlook indicated that inflation will ease back in the UK over the next year.

It said inflation is set to drop back to the target rate of 2% set by the government and Bank of England by mid-2027.

The pound traded at 1.3358 dollars on Wednesday afternoon, down from 1.3376 on Tuesday. Against the euro, sterling firmed to 1.1722 from 1.1704 on Tuesday.

The US 10-year Treasury yield traded at 4.60% on Wednesday, stretched from 4.52% on Tuesday, and the US 30-year Treasury yield widened to 5.09% from 5.03% on Tuesday.

Gold traded at 4,022.15 dollars an ounce on Wednesday, down from 4,144.14 on Tuesday.

On the FTSE 100, miners fell back as metal prices fell. Antofagasta dipped 6.4%, Rio Tinto fell 4.9%, Endeavour Mining slid 7.1% and Anglo American eased 6.3%.

Segro fell 1.8% after outlining financial targets and a pathway to “superior value creation” for shareholders, as it seeks to ward off the interest of suitor Prologis.

Ahead of a presentation to investors, the London-based warehouse landlord flagged substantial embedded value in its industrial and logistics development pipeline with the potential to deliver an additional £429 million of potential future headline rent.

The FTSE 100-listing said it is also well placed to capitalise on Europe’s fast-growing data centre opportunity with a pipeline of near to mid-term opportunities offering £460 million of income potential.

On the FTSE 250, Vistry fell 7.1% after it said chief financial officer Tim Lawlor is stepping down, and forecast a first-half pre-tax loss as a review by its new boss continues.

The Kent-based housebuilder expects to report a pre-tax loss of around £30 million in the first half of 2026, before any further impact from the strategic review led by Chief Executive Adam Daniels.

mR Daniels, who was promoted to CEO in April, is leading an operational review of the group, the findings of which will be shared no later than interim results in September.

RBC Capital Markets analyst Anthony Codling said it was a case of “one step forward, three steps back” at Vistry and warned that “things could get worse before they get better”.

“Progress is being made, but uncertainty remains,” he said, while “the group is not yet in a position to quantify the costs of the actions that need to be taken”.

The biggest risers on the FTSE 100 were BP, up 16.7p at 491.3p, Shell, up 68.5p at 3,079.5p, Centrica, up 2.0p at 171.5p, Admiral, up 36.0p at 3,650.0p, and Pershing Square Holdings, up 26.0p at 3,796.0p.

The biggest fallers were Endeavour Mining, down 271.0p at 3,562.0p, Antofagasta, down 241.0p at 3,527.0p, Anglo American, down 229.0p at 3,381.0p, Fresnillo, down 153.0p at 2,570.0p and Rio Tinto, down 335.0p at 6,490.0p.

Contributed by Alliance News