Lunchtime market roundup: London stocks lower as travel, airlines hit

Stock prices in London were mostly lower on Thursday midday, with airline stocks hit in particular as oil price volatility continued; meanwhile investors await US weekly jobless and trade balance data to be out shortly.

The FTSE 100 index was down 19.51 points, 0.2%, at 10,334.26. The FTSE 250 was down 45.70 points, 0.2%, at 22,332.01, and the AIM all-share was down 2.60 points, 0.3%, at 771.01.

The Cboe UK 100 was up 0.1% at 1,026.84, the Cboe UK 250 was down 0.1% at 19,550.44, and the Cboe small companies was down 0.2% at 17,777.64.

In European equities on Thursday, the CAC 40 in Paris was down 0.1%, while the DAX 40 in Frankfurt was up 0.2%.

The EU executive vowed to ‘respond firmly’ to any violation of a key tariff deal by the US after President Donald Trump announced new trade probes.

‘We will be seeking further clarity from the US on how the opening of this section 301 investigation would interact with’ the EU-US agreement struck last year, European Commission spokesman Olof Gill said.

‘The commission would respond firmly and proportionately to any breach of the joint statement commitments,’ he added.

Meanwhile, the conflict in the Middle East is causing the largest ever disruption to the global oil market, the International Energy Agency said in its monthly report, a day after coordinating the biggest release of emergency reserves in history in a bid to calm markets.

The US–Israel war against Iran, now in its 13th day, has driven oil prices sharply higher, with Brent crude topping $100 a barrel earlier on Thursday after fresh attacks on shipping in the Strait of Hormuz. Brent was trading at $96.72 at midday in London, up from $91.93 late Wednesday.

Three more cargo ships were struck overnight in the waterway, which carries around one-fifth of global oil shipments. Despite 32 countries agreeing on Wednesday to release a record 400 million barrels from strategic reserves, prices climbed amid persistent tensions and uncertainty over when the conflict might ease.

A sustained spike in energy prices could have a meaningful impact on UK inflation, the Office for Budget Responsibility has warned. David Miles, a member of the OBR’s budget responsibility committee, told MPs that oil prices are about 20% higher than before the escalation in fighting, while gas prices have risen by around 50%.

‘If there’s no change in the picture on prices from now on forward, we estimate something like a 1% higher level of consumer prices in the UK by the end of the year,’ he said. The OBR had previously expected inflation to be close to 2% without factoring in the latest energy shock.

The pound was quoted at $1.3396 at midday on Thursday in London, lower compared to $1.3410 at Wednesday’s close. The euro stood at $1.1553, lower against $1.1571. Against the yen, the dollar was trading at JP¥158.70, down from JP¥158.81.

Stocks in New York were called lower. The Dow Jones Industrial Average was called down 0.6%, the S&P 500 down 0.5%, and the Nasdaq Composite down 0.4%.

Initial US weekly jobless claims are due at 1230 GMT, with consensus pencilling in 215,000 claims, up slightly from 213,000 a week earlier. The US trade balance is also scheduled for release at the same time, with expectations for a $66.6 billion goods and services deficit for January, lower compared to $70.31 billion in December.

The yield on the US 10-year Treasury was quoted at 4.22%, widening from 4.21%. The yield on the US 30-year Treasury was quoted at 4.88%, widening from 4.85%.

Back in London, defence-focused stocks were among the leading FTSE 100 gainers, with BAE Systems and Babcock up 3.1% and 2.1% respectively. Rolls-Royce Holdings was up 1.2%

However, Rentokil Initial was the top blue-chip performer, rising 4.1% after UBS raised the stock to ’buy’ with a price target of 540 pence.

Haleon added 2.0% after the consumer healthcare group, whose brands include Sensodyne and Panadol, commenced the up to £500 million share buyback programme announced alongside its 2025 preliminary results.

Halma rose 0.3% after saying it has made ‘further strong progress’ in the second half of the financial year, consistent with upgraded guidance in November, putting it on track for a 23rd consecutive year of record adjusted profit.

The Amersham-based safety products manufacturer expects mid-teens percentage organic revenue growth at constant currency for the year to March 31, compared with a 9% rise to £2.25 billion in the prior financial year.

On the FTSE 250, TP ICAP topped the index, up 8.0%, after reporting 2025 revenue of £2.35 billion, up 4.4% from £2.25 billion, and pretax profit of £230 million, up 7.5% from £214 million. Revenue grew across all divisions except Energy & Commodities, where it fell 3%, as expected.

The firm also reduced net management and support costs despite inflation and higher UK national insurance.

Among smaller caps, On the Beach Group dropped 12% after temporarily withdrawing its full-year profit guidance following a sharp slowdown in bookings to key Mediterranean destinations.

The company suspended its previous adjusted pretax profit guidance of £39 million to £43 million for the year to September 30, 2026, citing weaker demand for trips to Turkey, Greece, Cyprus and Egypt.

Airlines have been among the sectors most affected since the conflict began, hit by both travel disruption and higher fuel costs following the rise in oil prices.

Shares in British Airways and Iberia owner IAG have fallen 14% since the conflict started, while Air France-KLM is down 20%. Low-cost carriers have also suffered, with Wizz Air down 24% and easyJet 17% lower over the same period.

Tour operator and airline Jet2 is also among those travel stocks affected, down 3.6% on Thursday and 11% since the conflict started.

Gold was quoted at $5,179.30 an ounce, up from $5,172.30 on Wednesday.

Still to come on Thursday’s economic calendar are US weekly jobless claims, US trade balance, US building permits and Canada trade balance.

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