LONDON MARKET EARLY CALL: FTSE 100 seen up as oil climbs again

(Alliance News) - Stocks in London are set to open higher on Monday, as investors monitor rising oil prices and fresh tensions surrounding stalled US-Iran negotiations.

IG says futures indicate the FTSE 100 to open up 26.2 points, 0.2%, at 10,259.27 on Monday. The index of London large-caps closed 0.4% lower at 10,233.07 on Friday.

US President Donald Trump described Iran's response to a US proposal aimed at ending the Middle East war as "totally unacceptable", accusing Tehran of "playing games".

According to Iranian state broadcaster IRIB, Tehran's counter-proposal included demands for compensation and recognition of its sovereignty over the Strait of Hormuz. The response, relayed through Pakistani mediators, reportedly focused on ending the conflict "on all fronts, especially Lebanon", where Israel continues fighting Iran-backed Hezbollah, as well as ensuring shipping security.

The original US proposal had reportedly centred on extending the Gulf truce to allow negotiations on a broader settlement and Iran's disputed nuclear programme. Separately, state outlet Press TV portrayed the US initiative as a demand for Tehran's surrender, saying acceptance would amount to submitting to Trump's "excessive demands".

Brent oil was trading at USD105.34 a barrel early Monday, higher than USD101.49 late Friday.

Sterling was quoted at USD1.3581 early Monday, lower than USD1.3623 at the London equities close on Friday. Against the euro, sterling fell to EUR1.1559 from EUR1.1568 a day prior.

The euro traded at USD1.1749 early Monday, lower than USD1.1773 late Friday. Against the yen, the dollar was quoted at JPY157.14 versus JPY156.63.

Back in the UK, Prime Minister Keir Starmer is expected to promise bolder action to tackle the country's "big challenges" as he seeks to steady his leadership following heavy election losses and growing unrest within the Labour Party.

Starmer will attempt to reset his premiership in a speech on Monday after renewed calls from Labour MPs for him to step aside. Potential rival Angela Rayner said the party needed to do more to support voters whose living standards have been squeezed.

Meanwhile, backbencher Catherine West said she could seek to trigger a leadership contest if she is left dissatisfied by Starmer's plans. Though West has said she does not intend to replace the prime minister herself, her move could open the door to other contenders, including Rayner and Health Secretary Wes Streeting.

Separately, the UK is expected to lose around 163,000 jobs this year because of the economic fallout from the Iran war, according to a report from the Item Club.

The group warned that lower-income regions such as South Wales and the Humber would be hit hardest due to their reliance on manufacturing and construction, sectors vulnerable to higher energy costs and supply disruption linked to the Middle East conflict. The report forecasts job losses of 5,700 in South Wales and 2,800 in the Humber during 2026.

In the US on Friday, Wall Street ended higher, with the Dow Jones Industrial Average marginally higher, the S&P 500 up 0.8% and the Nasdaq Composite up 1.7%.

In Asia on Monday, the Nikkei 225 index in Tokyo was down 0.4%.

In China, the Shanghai Composite was up 0.9%, while the Hang Seng index in Hong Kong was marginally lower.

Official data showed China's consumer inflation accelerated in April, with the consumer price index rising 1.2% year-on-year, up from 1.0% in March and ahead of the 0.8% increase expected by FXStreet-cited consensus.

Trade data also beat expectations. Exports from the world's second-largest economy climbed 14% year-on-year in April, sharply above the 8.4% increase forecast by economists surveyed by Bloomberg and a notable acceleration from March's 2.5% rise. Imports rose 25% on-year, beating expectations of 20%, though easing slightly from the 28% increase recorded in March.

The S&P/ASX 200 in Sydney was down 0.5%.

Elsewhere, Russian President Vladimir Putin said the war in Ukraine was "winding down" while criticising Western support for Kyiv, as the first day of a US-brokered ceasefire saw both sides accuse each other of violations. Speaking after a scaled-down military parade in Moscow, Putin said Russian troops were fighting an "aggressive force" backed by NATO and described the Kremlin's objectives in Ukraine as "just".

Gold was quoted at USD4,653.31 an ounce early Monday, lower than USD4,711.50 on Friday.

In Monday's corporate calendar, Caledonia Mining reports first-quarter results, while Compass Group and Victrex publish half-year figures.

In the economic calendar on Monday, US existing home sales data are due.

By Eva Castanedo, Alliance News reporter

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