London open: Stocks rally, oil prices fall amid peace hopes

(Sharecast News) - London stocks shot higher in early trade on Wednesday, while oil prices fell amid renewed hopes of a potential peace deal between the US and Iran.

At 0850 BST, the FTSE 100 was up 1.3% at 10,356.32, while Brent crude was down 1.6% at $108.16 a barrel after Donald Trump said he was pausing 'Project Freedom' to open the Strait of Hormuz as "great progress" was being made towards a "complete and final agreement with the representatives of Iran".

The US president said on Truth Social that the operation would be paused for "a short period of time" to see whether or not the agreement can be finalised and signed.

Susannah Streeter, chief investment strategist at Wealth Club, said: "A dam of tension has eased with relief flooding into financial markets, amid hopes that hostilities will cease in the Middle East, with the Trump administration making conciliatory moves. The Footsie 100 has rallied higher, with optimism replacing pessimism, given the ceasefire looks more likely to hold.

"Trump's announcement that Operation Epic Fury has been concluded, has triggered a wave of buying given there's less of a chance of the situation escalating once more. Relief is starting to seep into the bond markets, with UK gilt yields easing off amid hopes that inflation might not head quite as high if a longer-term resolution can be negotiated.

"Brent crude has been on the descent, but it's still trading above $108 dollars a barrel indicating that there's still scepticism around, and concern about how to get so many vital energy shipments moving again with the Strait of Hormuz still effectively blocked. There's still a big diplomatic impasse to break through, and so for now, the energy crunch is still a harsh reality to navigate."

In equity markets, miners and precious metals miners gained as gold, silver and copper prices rose, with Anglo American, Fresnillo, Antofagasta, Rio Tinto, Hochschild and Endeavour among the top performers.

Banks were also in the black, with Standard Chartered, NatWest and Barclays all up.

Drinks maker Diageo fizzed higher after its third-quarter organic sales growth beat expectations as solid performances in Europe, Latin American And Caribbean (LAC) and Africa helped to offset weakness in North America.

On the downside, Smith & Nephew slumped as it said it performed in line with expectations in the first quarter, backed its full-year outlook and announced a new $500 buyback.

BP and Shell gushed lower as oil prices eased back.

Kingfisher dipped as the B&Q owner said chief executive Thierry Garnier was stepping down after nearly seven years in the role to become president and CEO of Ahold Delhaize.

Retailer Next was a touch weaker despite lifting full-year guidance after first-quarter sales beat forecasts, boosted by unusually warm weather.

Online rail ticket platform Trainline slid as it cautioned the Iran war and a series of policy measures in the UK would hit sales this year.

Telecom Plus was knocked lower by a downgrade to 'hold' from 'buy' at Deutsche Bank.

JD Wetherspoons was little changed despite warning on profits again as the pub group pointed to higher costs.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "The shares are down over 20% year-to-date, and a flat reaction today suggests further weakness was already priced in. The group looks better placed than most to prosper when the economic tide turns, but near-term catalysts could be few and far between."

Market Movers

FTSE 100 (UKX) 10,356.32 1.34%

FTSE 250 (MCX) 22,630.81 0.83%

techMARK (TASX) 5,927.47 0.42%

FTSE 100 - Risers

Anglo American (AAL) 3,740.00p 4.61%

Fresnillo (FRES) 3,265.00p 4.43%

Standard Chartered (STAN) 1,892.20p 4.07%

Rolls-Royce Holdings (RR.) 1,245.60p 3.81%

NATWEST GROUP (NWG) 565.60p 3.74%

Antofagasta (ANTO) 3,694.00p 3.72%

Smurfit Westrock (DI) (SWR) 2,946.00p 3.39%

Prudential (PRU) 1,139.50p 3.22%

International Consolidated Airlines Group SA (CDI) (IAG) 375.90p 3.17%

Rio Tinto (RIO) 7,611.00p 3.12%

FTSE 100 - Fallers

Smith & Nephew (SN.) 1,119.50p -3.36%

Relx plc (REL) 2,619.00p -2.73%

BP (BP.) 563.30p -1.54%

Metlen Energy & Metals (MTLN) 37.29p -1.30%

The Sage Group (SGE) 897.60p -1.06%

London Stock Exchange Group (LSEG) 9,524.00p -0.73%

Shell (SHEL) 3,292.00p -0.53%

Experian (EXPN) 2,674.50p -0.50%

Kingfisher (KGF) 278.70p -0.43%

SSE (SSE) 2,545.00p -0.25%

FTSE 250 - Risers

Hochschild Mining (HOC) 626.00p 4.86%

Pan African Resources (PAF) 145.02p 4.84%

Close Brothers Group (CBG) 472.20p 4.62%

Endeavour Mining (EDV) 4,448.00p 3.78%

WH Smith (SMWH) 495.20p 3.56%

Pacific Horizon Inv Trust (PHI) 1,096.00p 3.40%

Bluefield Solar Income Fund Limited (BSIF) 82.60p 3.38%

PPHE Hotel Group Ltd (PPH) 1,538.00p 3.36%

Schroder Asian Total Return Investment Company (ATR) 657.00p 3.30%

Fidelity Emerging Markets Limited Ptg NPV (FEML) 1,388.00p 3.12%

FTSE 250 - Fallers

Trainline (TRN) 225.00p -6.10%

Premier Foods (PFD) 186.10p -4.47%

Telecom Plus (TEP) 1,112.00p -3.77%

SDCL Efficiency Income Trust (SEIT) 42.15p -2.54%

Ithaca Energy (ITH) 261.50p -2.46%

Harbour Energy (HBR) 286.80p -2.38%

Oakley Capital Investments Limited (DI) (OCI) 467.50p -2.31%

Syncona Limited NPV (SYNC) 88.20p -2.22%

VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 463.00p -2.11%

Ibstock (IBST) 103.00p -1.86%