LONDON MARKET EARLY CALL: FTSE 100 to fall after US strikes Iran again

(Alliance News) - Stocks in London are set to open lower on Thursday, after the US launched fresh strikes against Iran for the second time this week, leading to retaliation from Tehran against a US military base.

IG says futures indicate the FTSE 100 to open down 60.9 points, 0.6%, at 10,444.11 on Thursday. The index of London large-caps closed up 13.62 points, 0.1%, at 10,505.01 on Wednesday.

Sterling was at USD1.3394 on Thursday morning, down from USD1.3429 at the London equities close on Wednesday. Against the euro, sterling eased slightly to EUR1.1541 from EUR1.1543.

The euro was lower at USD1.1601 from USD1.1633. Against the yen, the dollar was marginally higher at JPY159.53 versus JPY159.46.

The US carried out new strikes on southern Iran, as the ceasefire between the two countries continued to come under strain.

The fresh fighting appeared to begin when Iranian forces fired at four ships attempting to cross the Strait, state broadcaster IRIB reported on Thursday.

US forces launched strikes that hit a ground control station in the southern port area of Bandar Abbas, a US official, speaking on condition of anonymity told AFP, prompting a swift response by Iran.

"Today, US Central Command Forces shot down four Iranian one-way attack drones that posed a threat around the Strait of Hormuz," the US official said.

The Iranian Guards did not provide details on the location of the US base, though Kuwait's military said its air defences were responding to an "enemy" attack on Thursday.

Fresh strikes were also reported in Lebanon, another front of the war.

Brent crude for July delivery was trading higher at USD97.31 a barrel on Thursday morning from USD96.61 on Wednesday.

Swissquote analyst Ipek Ozkardeskaya said: "Yesterday, investors swung between hope amid an Iranian memorandum suggesting that the Strait would reopen a month after a deal is reached, and disappointment again after the US denied the reports, with Donald Trump saying that ‘no nation’ would control the Strait. The news somehow cast a shadow over how close the two parties really are to reaching a concrete deal.

"In summary, a US/Iran peace deal – and the reopening of the Strait of Hormuz – now looks more complex than it did a few days ago. And the immediate impact is higher oil prices."

Meanwhile, UK total vehicle manufacturing declined slightly in April as weaker domestic demand outweighed a slight increase in export demand, an industry body reported.

The Society of Motor Manufacturers & Traders said total vehicle production in the UK fell 1.2% to 58,513 units in April from 59,203 units during the same month a year earlier.

In the US on Wednesday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.4%, the S&P 500 rose marginally while the Nasdaq Composite gained 0.1%.

In Asia on Thursday, the Nikkei 225 in Tokyo was down 0.6%. In China, the Shanghai Composite was 0.4% higher, while the Hang Seng Index in Hong Kong fell 1.5%. The S&P/ASX 200 in Sydney retreated 1.4%.

Salesforce reported a sharp rise in first quarter profit as it called agentic AI "the biggest growth opportunity" for its customers.

The San Francisco, California-based cloud-software company reported net income of USD2.11 billion in its first quarter to April 30, up 37% from USD1.54 billion a year ago.

Marvell Technology reported first quarter sales ahead of forecast and gave an upbeat forecast reflecting exceptional AI-related bookings.

The Santa Clara, California-based firm which engages in the design, development, and sale of integrated circuits said net income fell to USD34.5 million from USD177.9 million or to USD0.04 per basic share from USD0.21.

Gold was lower at USD4,392.99 an ounce early on Thursday from USD4,439.66 late Wednesday.

Thursday's global economic calendar has eurozone consumer confidence data plus US GDP and personal consumption expenditures figures.

Thursday's local corporate calendar has full year results from electricity generator SSE.

By Michael Hennessey, Alliance News reporter

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