London close: FTSE falls amid MidEast tensions; Burnham becomes PM

(Sharecast News) - London stocks fell on Monday amid escalating tensions between the US and Iran, as Andy Burnham became Prime Minister, sacking chancellor Rachel Reeves and paving the way for the expected appointment of Home Secretary Shabana Mahmood as he prepared to appoint his Cabinet.

The FTSE 100 closed down 0.7% at 10,524.76.

Patrick Munnelly at Tickmill Group said: "Burnham enters Downing Street promising to tackle living costs and struggling public services, but markets will want to see how those commitments are funded. The immediate question is not whether the new administration wants to support households and rebuild public capacity, but whether it can do so without unsettling the gilt market.

"The Chancellor appointment and early fiscal framework will therefore matter. After reports that Shabana Mahmood is likely to become Chancellor, investors will look for clarity on fiscal rules, departmental spending discipline, tax compliance, infrastructure investment and the sequencing of any structural reforms."

More broadly, although oil prices eased back from their highs after Tehran signalled that it was open to diplomatic talks with the US, the mood was downbeat after the US attacked Iran for the ninth night.

At the time of the UK market close, Brent crude was flat at $88.08 a barrel, having breached $90 earlier, while West Texas Intermediate was 0.3% lower at $82.23.

Munnelly said: "London edged lower on Monday as the FTSE 100 struggled against a renewed oil shock, rising shipping fears around the Strait of Hormuz and uncertainty over the policy direction of Britain's new prime minister, Andy Burnham. The index was not sharply weaker, but the tone was defensive as investors marked the start of a politically significant week while also confronting a worsening Middle East conflict.

"The immediate market pressure came from energy and shipping risk. US strikes on Iran entered a ninth straight day, and concerns over the Strait of Hormuz intensified after reports of tankers being immobilised."

In equity markets, housebuilders were among the worst performers, with Persimmon, Barratt and Vistry all weaker amid worries that higher rates will hit affordability.

Ryanair flew lower as the budget airline posted a 34% drop in first-quarter profit after tax, missing analysts' expectations, as fuel prices jumped and fares fell due to the conflict in the Middle East and the timing of Easter.

Segro rose, recovering from earlier losses after it rejected a sweetened �13.5bn approach from US logistics giant Prologis.

On the upside, Computacenter was the standout performer on the FTSE 100 after Berenberg upgraded the shares to 'buy' from 'hold' and hiked the price target to 5,300p from 3,450p following the company's first-half trading update.

Experian gained as Citi nudged down its price target on the stock due to the US dollar having weakened, but said it remains a buyer because it believes that AI-driven productivity can deliver attractive margin progression in North America.

Market Movers

FTSE 100 (UKX) 10,524.76 -0.71%

FTSE 250 (MCX) 23,540.71 -0.27%

techMARK (TASX) 5,885.45 -0.53%

FTSE 100 - Risers

Computacenter (CCC) 4,834.00p 5.55%

Flutter Entertainment (DI) (FLTR) 7,976.00p 3.40%

JD Sports Fashion (JD.) 88.14p 2.23%

Diploma (DPLM) 7,370.00p 1.80%

Experian (EXPN) 2,762.00p 1.58%

Relx plc (REL) 2,518.00p 1.41%

SEGRO (SGRO) 900.80p 1.05%

BP (BP.) 521.90p 0.93%

Autotrader Group (AUTO) 502.20p 0.78%

Whitbread (WTB) 2,406.00p 0.75%

FTSE 100 - Fallers

Persimmon (PSN) 1,046.50p -3.77%

Barratt Redrow (BTRW) 284.00p -3.17%

Kingfisher (KGF) 294.60p -3.16%

Metlen Energy & Metals (MTLN) 42.96p -2.94%

Airtel Africa (AAF) 334.60p -2.85%

Vodafone Group (VOD) 115.20p -2.66%

3i Group (III) 2,512.00p -2.48%

Halma (HLMA) 3,590.00p -2.34%

Bunzl (BNZL) 2,730.00p -1.94%

AstraZeneca (AZN) 12,380.00p -1.89%

FTSE 250 - Risers

Ocado Group (OCDO) 177.20p 7.26%

Pagegroup (PAGE) 171.10p 4.39%

Baltic Classifieds Group (BCG) 188.00p 4.04%

Frasers Group (FRAS) 751.50p 2.95%

Ithaca Energy (ITH) 241.80p 2.28%

JPMorgan Emerging Markets Growth & Income (JMGI) 164.40p 2.24%

Allianz Technology Trust (ATT) 689.00p 2.23%

Fidelity China Special Situations (FCSS) 256.50p 2.19%

ICG Enterprise Trust (ICGT) 1,428.00p 2.00%

Wetherspoon (J.D.) (JDW) 759.50p 1.95%

FTSE 250 - Fallers

Oxford Biomedica (OXB) 608.00p -5.88%

Vistry Group (VTY) 268.60p -4.62%

Ceres Power Holdings (CWR) 351.20p -4.46%

Plus500 Ltd (DI) (PLUS) 4,046.00p -3.90%

Foresight Environmental Infrastructure Limited (FGEN) 84.90p -3.74%

Mondi (MNDI) 724.20p -3.70%

Bridgepoint Group (Reg S) (BPT) 310.80p -3.66%

Taylor Wimpey (TW.) 80.22p -3.65%

Seraphim Space Investment Trust (SSIT) 146.40p -3.56%

Berkeley Group Holdings (The) (BKG) 3,306.00p -3.16%