(Alliance News) - Stock prices in London opened lower on Monday, while oil and gold prices fell, as tensions in the Middle East continue to shake markets.
The FTSE 100 index opened down 24.47 points, 0.3%, at 7,377.67. The FTSE 250 was down 37.88 points, 0.2%, at 16,994.85, and the AIM All-Share was down 2.22 points, 0.3%, at 680.71.
The Cboe UK 100 was down 0.3% at 736.34, the Cboe UK 250 was down 0.4% at 14,719.69, and the Cboe Small Companies was down 0.1% at 12,812.72.
In European equities on Monday, the CAC 40 in Paris was down 0.3%, while the DAX 40 in Frankfurt was down 0.1%.
"Risk sentiment is improved compared to Friday as tensions in the Middle East didn't escalate as much as feared during the weekend. Hamas released two hostages and humanitarian aid started to enter Gaza from the Egyptian border," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
Markets seemed somewhat more optimistic on Monday, as the situation in the Middle East did not escalate as expected over the weekend.
However, Israel's Defence Minister Yoav Gallant did warn that he expects that fighting could last for months in the war against the Islamist Hamas in the Gaza Strip.
"In terms of the operational aspects of manoeuvring - at the end of the day, nothing will stop the IDF. It is a combination of two things - our aerial capabilities and ground manoeuvring," Gallant said on Sunday in Tel Aviv.
A ground offensive by the Israeli military in the Gaza Strip could be imminent following Hamas' terrorist attack on Israel just over two weeks ago.
Meanwhile, the Pentagon moved to step up US military readiness in the Middle East in response to what it said were "recent escalations by Iran and its proxy forces" across the region.
Over the last two weeks, markets have reacted to the conflict by investing in safe-haven gold.
However, on Monday, gold prices eased. Gold was quoted at USD1,978.55 in London early Monday an ounce, lower against USD1,996.01 at market close Friday.
Further, oil prices also fell. Brent oil was quoted at USD91.60 a barrel early in London on Monday, down from USD93.20 late Friday.
Away from the war, the US budget deficit for the past year widened to USD1.7 trillion, government data showed, in a development that could add pressure on President Joe Biden as he seeks re-election in 2024.
The deficit expanded by USD320 billion for the fiscal year ending September 30, following a drop in tax revenues and lower deposits of earnings by the Federal Reserve on the back of higher interest rates.
The pound was quoted at USD1.2160 early on Monday in London, up compared to USD1.2156 at the equities close on Friday. The euro stood at USD1.0585, lower against USD1.0594. Against the yen, the dollar was trading at JPY149.90, higher compared to JPY149.84.
In London, the FTSE 250's Keller rose 9.5%.
Keller said that it has maintained "positive" trading in the its third quarter, ended September 30, following is "exceptionally strong" first half performance.
Based on this, the geotechnical engineering firm now expects full year underlying operating profit to be materially ahead of current market expectations.
"This performance reflects continued momentum and operational improvements within the business and the outstanding contribution of colleagues across the group, whom I would like to thank for their dedication and hard work," said Chief Executive Michael Speakman.
Indivior rose 7.0%.
The Virginia-headquartered pharmaceutical company said it has reached an agreement to resolve the claims brought by the direct purchasers in the In re Suboxone Antitrust Litigation multi-district litigation.
Indivior said it will pay USD385 million and will take a charge of USD228 million in the third quarter, which will be excluded from adjusted earnings.
"We are pleased to achieve this settlement to conclude this legacy multi-district antitrust matter," said Indivior CEO Mark Crossley.
"The resolution of this litigation, which was filed over a decade ago, provides greater certainty for all Indivior stakeholders and allows us to continue focusing on our important work for patients suffering from opioid use disorder and mental health illnesses around the world."
On AIM, Mission Group, the owner of a group of digital marketing and communications agencies, plummeted 55%.
The company said that whilst performance in the first half of 2023 was broadly in line with company expectations, recent trading has "rapidly become more challenging than previously anticipated."
It explained that this has been especially marked in the Consumer & Lifestyle, Property, and Technology & Mobility business units, where client wins have been more than offset by losses and several clients choosing to defer or significantly reduce spending.
Based on this, Mission Group said it is taking a materially more cautious view on the second half of 2023 and therefore the full-year outturn. It has also begun an operation review into the company.
In Asia on Monday, the Nikkei 225 index in Tokyo was down 0.8%. In China, the Shanghai Composite was down 1.5%. The S&P/ASX 200 in Sydney closed down 0.8%.
Financial markets in Hong Kong closed for the Chung Yeung Festival public holiday.
In the US on Friday, Wall Street ended lower, with the Dow Jones Industrial Average down 0.9%, the S&P 500 down 1.3% and the Nasdaq Composite down 1.5%.
Still to come on Monday's economic calendar, there is the EU FCCI Flash consumer confidence indicator at 1500 BST.
By Sophie Rose, Alliance News reporter
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Keller (KLR)
Indivior (INDV)
The Mission Group (TMG)