London's FTSE 100 rallied on Monday afternoon, recovering from a brief slump earlier in the session. Weir, the Glasgow-based mining-focused engineering firm, Airtel Africa, the telecoms operator, and Intercontinental Hotels Group, the owner of the Holiday Inn brand, led the index's risers, while Auto Trader and Melrose Industries weighed on the benchmark.

Investor attention, however, is trained on the other side of the Atlantic, where US Treasury Secretary Scott Bessent will hope his plans to double bond buybacks can halt the sell-off that rocked global markets last week. The Treasury has run regular buyback operations since 2024, its first sustained programme of repurchasing outstanding government debt in more than two decades, with officials citing cash-management needs and improved trading conditions in older, less liquid bonds as the rationale.

Bessent is in the spotlight for a second reason today: he is due to unveil a slew of sanctions on Iran which he says will bring an "economic D-Day" to the United States' months-long war with the country.

Iran's security chief has hit back at these threats, warning of an "earthquake-like" retaliation. "If the countries surrounding Iran join the Americans in their economic war, not a drop of oil will leave the Persian Gulf and the Strait of Hormuz, and we will also target other oil export routes from the Persian Gulf," Mohsen Rezaei said. The warning carries weight well beyond Tehran: the Strait of Hormuz is among the world's most critical oil chokepoints, with roughly a fifth of globally traded oil passing through it.

Oil prices fell slightly on Monday, dragging on the share prices of Shell and BP, which sit among the heavyweight constituents of the FTSE 100 and give the benchmark outsized sensitivity to swings in crude. Brent crude, the international benchmark for oil prices, dipped by about one per cent, leaving prices at just more than $93 per barrel.

Richard Hunter, head of markets at Interactive Investor, one of the UK's largest retail investment platforms, said: "With such a weight of concentration on the multitude of US events due this week, the UK opened as something of an investor sideshow. The FTSE 100 once more hugged the flatline, with no discernible trends among an equilibrium of opposing forces as well as lighter volumes."

On the domestic front, the government has announced a review into the business rates revaluations of pubs and hotels — business rates being the property-based tax on commercial premises, reset periodically to reflect rental values — as Greater Manchester mayor Andy Burnham continues his efforts to boost communities and high streets. Pub and hotel operators have been among the sectors campaigning hardest for reform of the levy.

The day's key developments, in chronological order:

• 7:12am — Saba Capital puts pressure on Baillie Gifford
• 7:26am — Bessent warns of 'economic D-Day' for Iran
• 8:09am — FTSE 100 shaky on market open
• 8:53am — Shein value shrinks to $27bn ahead of Hong Kong IPO
• 9:41am — FTSE 100 steadies as Airtel Africa leads risers

Source: City AM Markets