London midday: FTSE maintains gains amid mixed messages on peace talks

(Sharecast News) - London stocks were still in the black by midday on Tuesday as investors mulled more mixed messages on progress in US-Iran peace talks, with oil prices up again after the US carried out new strikes on Iran.

The FTSE 100 was up 0.8% at 10,544.93, likely playing catching up with the gains seen in Europe on Monday when UK markets were closed.

Brent crude - which had tumbled on Monday amid signs of progress in peace talks - was up 2.1% at $98.16 a barrel after the US launched fresh strikes on Iran, threatening the fragile ceasefire that began on 8 April.

The US struck Iranian missile launch sites and mine-laying boats in southern Iran overnight, with Central Command (Centcom) saying it was an act of self-defence. Centcom spokesperson Navy captain Tim Hawkins said Centcom "continues to defend our forces while using restraint during the ongoing ceasefire".

US Secretary of State Marco Rubio said a peace deal with Iran was still possible despite the strikes. Speaking to reporters on an official visit to India, he said: "We'll see if we can make progress. I think it's a lot of talking back and forth going on about specific language in the initial document, so it'll take a few days."

He said President Donald Trump had "expressed his desire to make it". "He's either going to make a good deal or no deal," Rubio said.

Over the weekend, Trump said an agreement with Iran had been "largely negotiated" and that details, which include the reopening of the Strait of Hormuz, would be announced soon. Trump's announcement was made following a call with leaders and officials from Qatar, Saudi Arabia, the United Arab Emirates, Pakistan, Jordan, Egypt, Turkiye, and Bahrain.

Trump said on Truth Social: "Final aspects and details of the deal are currently being discussed, and will be announced shortly."

Kathleen Brooks, research director at XTB, said: "Markets are digesting mixed messages coming out of the White House regarding the war in Iran. Over the weekend, hopes were high that a deal between the US and Iran could be agreed in the short term. This caused a 6% decline in the price of oil on Monday, and a broad rally in stock and bonds.

"However, investor enthusiasm has partly shifted on Tuesday. The US launched fresh 'defensive strikes' against Iran, however, Iranian officials remain in Doha for peace talks to end the war. Hopes are fading for an imminent end to the conflict; however, markets want to believe that the war will end soon. This is why stocks remain elevated, and US indices remain close to record highs.

"The problem for investors is that the alternative, a prolonged war with no sign of the Strait of Hormuz reopening, could trigger long term economic damage to the global economy. The world cannot keep running down oil inventories, at some point, Middle East oil will be required to sustain economic growth, even if the global economy has been resilient so far. If we reach this point, this is when stock market will react, until then we could see a further grind higher in US stocks, with European and Asian indices more vulnerable to moves in the oil price."

In equity markets, B&Q and Castorama owner Kingfisher shot to the top of the FTSE 100 after saying it was still on track to meet full-year guidance despite a 0.9% fall in first-quarter sales due to softer markets in the UK and France.

Heavily-weighted miners were also on the rise, with Glencore, Rio Tinto and Anglo American all higher as copper prices advanced.

BA and Iberia owner IAG flew higher as Morgan Stanley said it was its top pick in European airlines.

Veterinary services provider CVS Group gained after saying it has successfully refinanced its bank debt facilities, and announcing the launch of a £50m share buyback and the acquisition of a small animal practice in Australia.

Qinetiq was boosted by an upgrade to 'buy' from 'hold' at Peel Hunt.

On the downside, Melrose Industries slid following a chemical incident at GKN Aerospace's Garden Grove facility in the US. The company said there had been mandatory evacuation orders for portions of the surrounding community to protect public safety while response operations continued but that there had been no injuries, leaks or contamination.

Autotrader was also under the cosh after Panmure Liberum downgraded the stock to 'hold' from 'buy' and slashed the price target to 420p from 830p.

Market Movers

FTSE 100 (UKX) 10,544.93 0.75%

FTSE 250 (MCX) 23,376.52 0.90%

techMARK (TASX) 6,074.60 0.10%

FTSE 100 - Risers

Kingfisher (KGF) 305.50p 4.31%

Metlen Energy & Metals (MTLN) 40.44p 3.75%

International Consolidated Airlines Group SA (CDI) (IAG) 411.20p 3.55%

Scottish Mortgage Inv Trust (SMT) 1,535.50p 2.64%

British Land Company (BLND) 406.20p 2.52%

Mondi (MNDI) 756.20p 2.52%

NATWEST GROUP (NWG) 596.80p 2.26%

Rio Tinto (RIO) 7,945.00p 2.17%

Barclays (BARC) 455.80p 2.14%

Glencore (GLEN) 581.50p 2.09%

FTSE 100 - Fallers

Autotrader Group (AUTO) 433.90p -4.49%

Melrose Industries (MRO) 489.20p -3.91%

Rightmove (RMV) 432.40p -1.77%

Admiral Group (ADM) 3,426.00p -1.55%

Vodafone Group (VOD) 109.60p -1.53%

BP (BP.) 543.80p -1.27%

BT Group (BT.A) 222.10p -1.20%

Flutter Entertainment (DI) (FLTR) 7,292.00p -1.14%

Shell (SHEL) 3,185.50p -0.67%

Weir Group (WEIR) 2,490.00p -0.56%

FTSE 250 - Risers

Raspberry PI Holdings (RPI) 793.25p 5.94%

CVS Group (CVSG) 1,266.00p 5.67%

QinetiQ Group (QQ.) 497.60p 4.32%

Pan African Resources (PAF) 139.60p 3.95%

Syncona Limited NPV (SYNC) 101.80p 3.88%

BlackRock World Mining Trust (BRWM) 998.00p 3.74%

Johnson Service Group (JSG) 142.60p 3.64%

Wizz Air Holdings (WIZZ) 1,009.00p 3.53%

HGCapital Trust (HGT) 341.00p 3.50%

SSP Group (SSPG) 169.80p 3.41%

FTSE 250 - Fallers

AEP Plantations (AEP) 1,742.00p -6.44%

Kainos Group (KNOS) 863.00p -2.39%

Diversified Energy Company (DI) (DEC) 1,128.00p -2.08%

Ithaca Energy (ITH) 238.60p -2.01%

Harbour Energy (HBR) 278.60p -1.83%

C&C Group (CDI) (CCR) 106.20p -1.67%

Telecom Plus (TEP) 1,052.00p -1.50%

Spire Healthcare Group (SPI) 219.50p -1.35%

Energean (ENOG) 837.50p -1.06%

Helios Towers (HTWS) 242.40p -1.06%