FTSE 100 Gains as Surging Oil Prices Offset Geopolitical Jitters

London's FTSE 100 index edged higher in Monday trading, as a sharp rally in crude oil prices lifted heavyweight energy stocks and outweighed broader market caution stemming from escalating military tensions in the Middle East. The gains in London came even as other major European bourses started the week on the back foot.

Market Reaction

The UK's FTSE 100 rose 0.07% in early trading, according to Investing.com data. In contrast, Germany’s DAX slipped 0.16% and France’s CAC 40 was down 0.20%, reflecting wider risk-off sentiment.

The divergence was driven by a surge in energy prices on fears of supply disruption in the Gulf. Brent crude jumped 3.8% to $78.86 a barrel, while West Texas Intermediate (WTI) gained 3.7% to $74.06. The FTSE 100's heavy weighting of major energy producers helped insulate it from the broader downturn. Elsewhere, sterling eased against the dollar, with GBP/USD falling 0.16%, while gold futures declined 1.2%.

U.S. Strikes Escalate Tensions

The market moves followed reports of fresh U.S. military action against Iran. U.S. Central Command confirmed it carried out strikes on Sunday to degrade Tehran’s ability to target commercial shipping. The action follows an alleged Iranian strike on the Cyprus-flagged container ship M/V GFS Galaxy.

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Conflicting statements have added to market uncertainty. U.S. President Donald Trump told NBC that the vital Strait of Hormuz remained open, but Iran’s Persian Gulf Strait Authority said passage was closed pending a security review. According to CENTCOM, U.S. forces have hit more than 300 Iranian military targets over three nights this week.

UK Corporate Movers

On the corporate front, several UK-listed companies provided trading updates:

• PageGroup reported better-than-expected gross profit for the second quarter, citing strength in the Americas and Asia which helped offset weakness in Europe and the UK.
• ME Group reaffirmed its full-year profit guidance, noting that trading had recovered following a slowdown in April.
• Plus500 also reaffirmed its full-year guidance after posting its strongest first-half revenue in three years, helped by higher trading activity.