London midday: Stocks tick higher, oil falls amid US-Iran peace hopes

(Sharecast News) - London stocks had ticked higher by midday on Friday as oil prices fell amid hopes of a peace deal between the US and Iran.

The FTSE 100 was up 0.3% at 10,455.56, while Brent crude was down 1.7% at $92.09 a barrel following a report late on Thursday that the US and Iran have reached an agreement on a 60-day memorandum of understanding to extend the ceasefire and launch negotiations on Tehran's nuclear programme.

Citing two US officials and a regional source involved in the mediation efforts, Axios said Trump has yet to give his final approval, while Iran has also not confirmed its acceptance.

Speaking to reporters at Joint Base Andrews on Thursday, Vice President JD Vance said the US was "very close" to finalising an agreement with Iran but that there were still a few sticking points, such as "a couple of issues on the nuclear stuff, the highly enriched stockpile and also the question of enrichment".

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "The resumption of airstrikes between the US and Iran weighed on the London index yesterday, but a reported 60-day extension to the fragile ceasefire and a possible agreement to reach an agreement seems to have settled nerves today.

"What all that actually means is anybody's guess, but oil traders are taking an optimistic view that the end could be in sight for disruption in the region, and Brent Crude oil prices have taken another step down to under $92 per barrel, around 20% off the peaks seen earlier in the month."

Corporate news was scarce but Ocado surged after agreeing to enter a partnership with Asda to develop the latter's online business across the UK with the Ocado Smart Platform.

No financial details were disclosed but Ocado said the focus of the partnership will be to quickly replace and upgrade Asda's existing ecommerce infrastructure, with Ocado's solutions to be rolled out across both stores and dark stores from 2027.

Ocado and Asda plan to deploy Ocado's end-to-end solutions across Asda ecommerce operations. These include Ocado's front-end (webshop), In-Store Fulfilment, and software to support last mile planning and route efficiency.

Ocado said the transaction is not expected to have a material financial impact in FY26.

Russ Mould, investment director at AJ Bell, said the deal was "some much-needed good news" for Ocado.

"For Asda, this deal may give it some heft to take on Tesco and Sainsbury's at a time when its position in the UK groceries market is looking fragile, while for Ocado it is a ray of light after a difficult period for the business," he said.

"It still feels a world away from the idea Ocado could become a global leader, licensing its platform to help supermarkets around the world set up their own web-based solutions, a story which really captured the imagination during the pandemic. Particularly given this deal follows a major setback with its big US partner Kroger last year.

"Despite a healthy bump today, the shares still sit more than 90% below the all-time highs achieved in 2020 when excitement around the stock and the potential for global growth hit fever pitch.

"Management at first blamed Covid restrictions for preventing it from meeting companies to agree contracts at the pace the market was hoping for. In the intervening period, the company has been plagued by operational issues, a patent dispute and surging costs.

"Long-standing shareholders will hope this is the first step in a less grandiose but still meaningful growth story."

Drugmaker AstraZeneca gained as it said that Imfinzi has been approved in the US as part of the first immunotherapy‑based combination for patients with high‑risk, non‑muscle‑invasive bladder cancer who have not previously been treated with Bacillus Calmette-Guérin.

On the downside, retailers were under the cosh after a raft of downgrades by Deutsche Bank. B&M European Value Retail and Wickes were both weaker after a downgrade to 'sell' from 'hold', while Currys and Dunelm were hit by downgrades to 'hold' from 'buy'.