FTSE 100 Extends Gains as Oil Prices Pull Back; White House Says No Iran Talks Underway
Key Takeaways
- •Brent crude rose roughly 1.5 percent to return to $90 per barrel, reversing earlier losses in the week.
- •Iran's military announced a revenue-sharing agreement with Oman over the Strait of Hormuz, though Tehran said it would not force the strait's immediate reopening.
- •The White House stated that no negotiations are currently taking place between the US and Iran, despite Qatar's prime minister visiting Tehran.
- •US tech stocks soared after Nvidia more-than-doubled its sales.
- •Analysts at AJ Bell noted a market rotation toward tech names, with HSBC, Shell, AstraZeneca and British American Tobacco weighing on the FTSE 100.
The UK's blue-chip FTSE 100 index extended its gains on Friday as pressures in the oil market eased.
Oil prices had rebounded on Thursday night, reversing days of losses earlier in the week. Brent crude, the international benchmark, jumped roughly 1.5 per cent to return to $90 per barrel.
Investors were reacting to conflicting signals over whether oil supplies are set to improve. Iran's military said it had reached a revenue-sharing agreement with Oman over the vital trade route, but Tehran insisted the deal would not enforce the immediate reopening of the strait. The Strait of Hormuz is one of the world's most important energy chokepoints, with roughly a fifth of globally traded oil passing through it, so any disruption there tends to move crude prices and, in turn, energy-heavy indexes like the FTSE 100, where oil majors such as Shell and BP carry significant weight.
Confusion over Middle Eastern negotiations persisted later on Thursday night after it emerged that Qatar's prime minister had visited Tehran to discuss a deal over the Strait of Hormuz. The White House, however, insisted that no negotiations are taking place between the US and Iran.
"No negotiations are happening right now and this will continue until the president feels that maybe they come to the table in a meaningful way. We have not seen that yet," said Karoline Leavitt, press secretary to President Donald Trump.
Tech stocks soared in the US on Thursday after Nvidia more-than-doubled its sales. Dan Coatsworth, AJ Bell's head of markets, commented: "Whereas tech stocks were electric, other parts of the market suffered outages. The FTSE 100 was grumpy, with HSBC, Shell, AstraZeneca and British American Tobacco among the names weighing the market down.
"That suggests a market rotation away from stodgy all-weather businesses and oil price hike beneficiaries towards tech names like Computacenter and Sage. Tech stocks have much less influence on the UK market versus the way they dominate the US, hence why the sell-off in banks, oil producers and tobacco companies mattered more."
This morning's top stories
- 10:45am – Markets brace for Warsh speech at Jackson Hole
- 8:40am – Goldman: Oil exports recover to two-thirds of pre-war levels
- 7:40am – Business confidence climbs to post-Iran war high
- 7:10am – White House not talking to Iran
- 7:00am – Opening post
