London open: FTSE gains as oil prices rise on Middle East tensions
London stocks gained in early trade on Wednesday, with oil prices on the rise as tensions in the Middle East escalated further.
At 0820 BST, the FTSE 100 was up 0.4% at 8,308.26.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "The FTSE 100 has headed higher in early trade, partly because of its defensive nature, helped by strength in energy stocks as oil prices continue their march upwards.
"As Iran’s cruise missile attack on Israel and fresh strikes on Hezbollah in Lebanon have unnerved investors. The uncertainty has made safe-haven assets like gold more popular, with demand for the precious metal ticking up close to record levels, as violence spills further across the Middle East, briefly climbing above $2,670 an ounce. Already sought after, amid concerns that inflationary pressures would persist, fresh geopolitical fracture has increased demand for gold. The dollar has steadied after gaining ground and US Treasuries proved more popular, indicated by falling yields, as investors have sought out trusted shelters amid the widening conflict.
"Oil prices are climbing, with Brent Crude approaching $75 a barrel, as supply concerns swirl again, sparked by heightened aggression. These worries are being mitigated by expectations that Saudi Arabia will turn on the taps more fully, and lower demand from China, but upwards pressure is likely to continue while uncertainty reigns about just how far conflict will spread."
In equity markets, oil giants BP and Shell were among the top performers on the FTSE 100.
Heavily-weighted miners also advanced, with Rio, Anglo American, Glencore and Antofagasta all up.
Defence firm BAE Systems was also in the black amid escalations in the Middle East.
Saga surged after it confirmed it is in talks with Belgian insurer Ageas about a potential partnership arrangement for its insurance business.
On the downside, JD Sports Fashion slumped as it held annual guidance after delivering a 2% rise in half-year profit despite what it called a "volatile market".
The company reported profit before tax and adjusting items of £405.6m for the six months to 3August, compared with £398m a year earlier. Revenue jumped 5.2% to £5bn.
The JD share price decline was likely due to negative read-across from Nike, whose shares fell sharply after the sportswear retailer withdrew its annual revenue forecast and posted a 10% drop in first-quarter revenue.
Market Movers
FTSE 100 (UKX) 8,308.26 0.38%
FTSE 250 (MCX) 20,923.02 0.04%
techMARK (TASX) 4,840.12 -0.17%
FTSE 100 - Risers
BP (BP.) 407.75p 1.68%
Prudential (PRU) 702.80p 1.62%
Rio Tinto (RIO) 5,382.00p 1.59%
Shell (SHEL) 2,516.50p 1.55%
Anglo American (AAL) 2,480.50p 1.53%
HSBC Holdings (HSBA) 672.80p 1.22%
BAE Systems (BA.) 1,287.50p 1.10%
Glencore (GLEN) 433.75p 1.08%
Smiths Group (SMIN) 1,690.00p 1.02%
Antofagasta (ANTO) 2,012.00p 0.98%
FTSE 100 - Fallers
JD Sports Fashion (JD.) 145.85p -2.44%
International Consolidated Airlines Group SA (CDI) (IAG) 190.50p -2.41%
easyJet (EZJ) 492.30p -1.85%
Beazley (BEZ) 748.00p -0.86%
InterContinental Hotels Group (IHG) 8,032.00p -0.82%
British American Tobacco (BATS) 2,738.00p -0.62%
Entain (ENT) 765.80p -0.60%
Smurfit Westrock (DI) (SWR) 3,676.00p -0.59%
Flutter Entertainment (DI) (FLTR) 17,700.00p -0.59%
Vodafone Group (VOD) 74.68p -0.59%
FTSE 250 - Risers
Fidelity China Special Situations (FCSS) 235.50p 5.37%
Mony Group (MONY) 214.60p 3.07%
JTC (JTC) 1,070.00p 2.29%
Ninety One (N91) 179.10p 1.99%
Spirent Communications (SPT) 173.90p 1.70%
CMC Markets (CMCX) 309.50p 1.64%
Pacific Horizon Inv Trust (PHI) 607.00p 1.51%
Smithson Investment Trust (SSON) 1,448.00p 1.40%
Volution Group (FAN) 598.00p 1.36%
Asia Dragon Trust (DGN) 431.00p 1.17%
FTSE 250 - Fallers
Aston Martin Lagonda Global Holdings (AML) 112.40p -4.10%
Primary Health Properties (PHP) 98.50p -3.71%
Wetherspoon (J.D.) (JDW) 703.50p -3.37%
Dr. Martens (DOCS) 53.80p -3.24%
Softcat (SCT) 1,505.00p -2.53%
Ibstock (IBST) 177.60p -2.42%
Derwent London (DLN) 2,378.00p -2.14%
Balfour Beatty (BBY) 427.00p -2.06%
Hays (HAS) 89.60p -1.81%
NCC Group (NCC) 170.40p -1.73%