LONDON MARKET EARLY CALL: FTSE 100 to edge down as Iran threatens US

(Alliance News) - Stocks in London are set to open slightly lower on Wednesday, as investors continue to weigh the chances of further progress in peace talks between the US and Iran.

IG says futures indicate the FTSE 100 to open down 9.3 points, 0.1%, at 10,482.09 on Wednesday. The index of London large-caps closed up 25.13 points, 0.2%, at 10,491.39 on Tuesday.

Sterling was at USD1.3453 on Wednesday morning, up from USD1.3443 at the London equities close on Tuesday. Against the euro, sterling eased to EUR1.1551 from EUR1.1567.

The euro was higher at USD1.1641 from USD1.1622. Against the yen, the dollar was marginally lower at JPY159.31 versus JPY159.33.

Iran accused the US of breaching their ceasefire and warned it was ready to retaliate after overnight US strikes on Monday targeting Iranian missile sites and mine-laying boats threatened a deal to end the war.

Iranian state media reported overnight blasts in the southern port city of Bandar Abbas, near the Strait of Hormuz, and the country's Revolutionary Guards said its forces had downed a US drone entering its airspace and had fired at an F-35 fighter jet.

"The US terrorist army, continuing its illegal and unjustified actions since the ceasefire ... has, in the past 48 hours, committed a gross violation of the ceasefire in the Hormozgan region," the Iranian foreign ministry said.

It added that Tehran "will not leave any evil unanswered and will not hesitate to defend the Iranian nation," without elaborating.

Brent oil was trading lower at USD98.03 a barrel on Wednesday morning from USD100.18 on Tuesday.

Meanwhile, eight in 10 UK firms are suffering a hit from the Iran war and a fifth of businesses are putting investment plans on hold because of the geopolitical uncertainty, according to a report.

The latest Barclays Business Prosperity index revealed 80% of UK businesses reported a negative impact from the Middle East conflict. More than two-thirds or 64% said energy and fuel costs were impacting on their business, with 34% hit by higher shipping and logistics costs and a third suffering supply chain disruption, the report found.

In the US on Tuesday, Wall Street ended mixed, with the Dow Jones Industrial Average down 0.2%, the S&P 500 0.6% higher and the Nasdaq Composite gained 1.2%.

Swissquote analyst Ipek Ozkardeskaya said: "It looks like geopolitical tensions are no longer bothering investors as much as they did in previous weeks. Iran's explicit dissatisfaction regarding the progress in talks over its nuclear program — or even US strikes — didn't reverse hopes that the war will end soon."

In Asia on Wednesday, the Nikkei 225 in Tokyo was up 0.5%. In China, the Shanghai Composite was 1.4% lower, while the Hang Seng Index in Hong Kong fell 0.9%. The S&P/ASX 200 in Sydney gained 0.5%.

Gold was lower at USD4,493.20 an ounce early on Wednesday from USD4,504.21 late Tuesday.

Wednesday's global economic calendar has UK grocery market share data and the Richmond Fed manufacturing index.

Wednesday's local corporate calendar has half-year results from Greencore and Hollywood Bowl.

By Michael Hennessey, Alliance News reporter

Comments and questions to newsroom@alliancenews.com

Copyright 2026 Alliance News Ltd. All Rights Reserved.