Lunchtime market roundup: Shares down; oil prices up on Gulf tensions

Blue chip stock indices in London, Paris and Frankfurt were lower at Wednesday midday as heightened US-Iran tensions led to an increase in oil and gas prices; meanwhile it appeared increasingly likely that the European Central Bank will raise interest rates next week.

The FTSE 100 index was down 72.93 points, 0.7%, at 10,716.35. The FTSE 250 was 241.70 points, 1.0%, at 24,279.59, and the AIM all-share was down 7.75 points, 1.0%, at 788.31.

The Cboe UK 100 was down 0.7% at 1,065.31, the Cboe UK 250 was down 1.1% at 21,110.01, and the Cboe small companies was down 0.3% at 18,914.26.

In European equities on Wednesday, the CAC 40 in Paris was down 0.7%, while the DAX 40 in Frankfurt was down 0.8%.

European Central Bank Governing Council member Joachim Nagel indicated that the central bank will raise borrowing costs next week, while fellow member Gabriel Makhlouf said the decision "won't be a surprise", in interviews published Wednesday.

Speaking to Le Monde, Nagel said: "Markets are pricing in a probability of more than 95% that we will raise interest rates at our September meeting, and I would say that the markets have a rather good understanding of how we are likely to respond at this stage."

However, Nagel, who is the Bundesbank president, didn't commit to further moves beyond this month, saying only that "our meeting-by-meeting approach has served us well in the past and will certainly do so in the future".

Energy prices climbed after US forces struck Iran's Revolutionary Guards in response to what Washington said were attempted attacks on commercial shipping and American troops.

Brent crude climbed to USD95.06 a barrel at midday Wednesday from USD92.48 late Tuesday.

US President Donald Trump said the strikes were in retaliation for Iran's alleged attempt to lay sea mines in the Strait of Hormuz and missile launches towards a US base in Jordan, warning Tehran of a

tougher response to any retaliation.

Iranian state media reported explosions in the country's south, while Iran's Revolutionary Guards later claimed responsibility for a ballistic missile attack on a US base in Jordan. Jordan's military said it intercepted most of the missiles and reported no injuries.

European gas prices also surged. The Dutch TTF contract, the benchmark for European gas, for October delivery hit EUR75.33 per megawatt-hour on Wednesday, its highest level since January 2023.

The pound was quoted at USD1.3480 at midday Wednesday, lower than USD1.3527 at the London equities close on Tuesday. Against the euro, sterling fell to EUR1.1651 from EUR1.1669.

The euro slipped to a two-week low against the dollar, as higher energy prices and rising US bond yields added to pressure on the single currency, while options traders moved to protect against further losses.

The euro traded at USD1.1568 at midday Wednesday, lower than USD1.1593 late Tuesday. Against the yen, the dollar was quoted at JPY159.90 versus JPY160.07.

Meanwhile, the European Commission approved a German state aid scheme worth up to EUR35.2 billion to support the construction of new gas-fired power plants.

Berlin plans to build plants with a combined capacity of up to 11 gigawatts over the next five years.

The commission said the measure was necessary to ensure energy supply security and that the funding level was appropriate.

The plants will initially burn natural gas but will be required to switch to climate-friendly hydrogen by 2045.

Stocks in New York were called lower. The Dow Jones Industrial Average was called down 0.2%, the S&P 500 index down 0.3%, and the Nasdaq Composite down 0.6%.

The yield on the US 10-year Treasury was quoted at 4.80%, widening from 4.77%. The yield on the US 30-year Treasury was quoted at 5.28%, widening from 5.25%.

Back in London, InterContinental Hotels Group led the FTSE 100 higher, up 1.7%, after UBS raised the hotel operator to 'buy' and set a price target of USD188.

Admiral Group and NatWest Group both rose 1.2%. Morgan Stanley raised NatWest to 'overweight', while Jefferies lifted its price target for the lender.

Endeavour Mining added 0.7%, while Halma rose 0.5% after acquiring Texas-based water quality monitoring specialist Pyxis.

At the other end of the index, Computacenter fell 3.3%.

Pearson lost 2.5% after Citi cut the education publisher to 'neutral' and set a price target of 1,345 pence.

Among smaller caps, Jadestone Energy rose 5.1% after Prima Energy said it had acquired a stake of more than 28% in the oil and gas producer.

Prima said it has no intention of making a takeover offer for Jadestone. Jadestone noted the announcement but said it had not received independent confirmation of the sale.

Aminex jumped 27% after reaching an agreement on the implementation of the Ntorya gas development.

Kazera Global also surged 27% after securing a 10-year mining right for its heavy mineral sands project in South Africa.

RentGuarantor Holdings climbed 10% after raising its 2026 targets following strong trading in the first eight months of the year.

Revenue multiplied to £8.5 million from £1.5 million a year earlier, driven by strong customer growth following the Renters' Rights Act in the UK. Adjusted earnings before interest, tax, depreciation and amortisation swung to £2.8 million from a £122,000 loss, while adjusted net profit swung to £2.9 million from a £392,000 loss.

RentGuarantor now targets full-year revenue of more than £14 million and net profit above £4 million, with revenue, adjusted Ebitda and adjusted net profit expected to be materially ahead of market expectations.

Cash increased to around £7.5 million at August 31 from £2.4 million at June 30, prompting the company to consider introducing a dividend policy.

On the downside, Quantum Blockchain Technologies slumped 18% after raising £350,000 through a placing of 140 million new shares at 0.25 pence each.

Rome Resources fell 14% despite reporting a 45% increase in its contained tin estimate at the Kalayi project in the Democratic Republic of Congo.

Gold was quoted at USD4,309.23 an ounce at midday Wednesday, lower than USD4,364.48 on Tuesday.

Still to come on Wednesday's economic calendar, the US publishes the ADP employment report for August and factory orders for July. Canada announces its latest interest rate decision, with a hold at 2.25% widely expected.

Copyright 2026 Alliance News Ltd. All Rights Reserved.