London midday: FTSE flat, oil rises amid Hormuz impasse

(Sharecast News) - London stocks were flat by midday on Tuesday, with oil prices up as the impasse over the Strait of Hormuz dragged on after Donald Trump said he would be seeking compensation from Iran for "50 years" of damages.

The FTSE 100 was steady at 10,867.30, erasing earlier small losses, while Brent crude was up 1.6% at $89.16 a barrel and West Texas Intermediate was 1.8% higher at $83.62.

Patrick Munnelly at Tickmill Group noted that Brent is now more than 12% above last week's low, a sharp reversal from the earlier optimism around a possible reopening of the Strait of Hormuz.

"President Trump's new demand for US compensation from Iran as part of any negotiation has further reduced expectations of near-term progress," he said. "That makes a return to normal shipping traffic through Hormuz look increasingly unlikely. For energy markets, this is no longer a clean reopening story; it is a stalemate with a rising risk premium.

"The market's focus is now firmly on Wednesday's US CPI report. Last Friday's weaker employment data had lowered fears of an imminent Fed hike, but the oil rally has quickly revived inflation concerns. The Fed problem is becoming more awkward. Labour-market cooling can justify patience, but energy-driven inflation can undermine that patience if it lifts headline CPI, gasoline prices and household inflation expectations."

On home shores, industry data showed that growth in retail sales eased in July as non-food sales took a hit from the heatwave. According to the latest BRC-KPMG retail sales monitor, total sales rose 1.3% year-on-year following 2.5% growth in July 2025. This was below the 12-month average of 1.8% growth.

Food sales were up 3.8% last month following 3.9% growth in the same month last year, while non-food sales fell 0.7%, having risen 1.4% in July 2025.

In-store non-food sales declined by 1.9% following a 1.9% increase in July last year, while online non-food sales rose 1.3%, an improvement on July 2025's increase of 0.3%.

Helen Dickinson, chief executive at the British Retail Consortium, said: "July saw modest sales growth, with food sales boosted by the final week of the World Cup. Non-food sales were hit by the decline in footfall as shoppers avoided the heat. Clothing was a bright spot, driven by demand for affordable summer essentials, while footwear struggled to keep up. Shoppers also prioritised smaller indulgences such as beauty products and fashion jewellery, while delaying bigger-ticket purchases including furniture and computing.

"Consumer demand has struggled in the heat, leaving retailers facing a challenging start to the second half of the year. Household budgets remain stretched, consumer confidence is fragile, and retailers continue to grapple with rising operating costs. If the Government wants to drive growth and keep inflation under control, it must reduce the cost of doing business by tackling the taxes and regulatory burdens that are holding back investment and putting upward pressure on prices. These include business rates, new packaging taxes, and the rising costs of employment."

Separate figures from Barclays showed consumer confidence hit its highest level in nearly two years in July as hospitality and leisure spending was boosted by warm weather and the World Cup.

In equity markets, Spirax Group tumbled even as it posted a rise in first-half profit and revenue and said it was on track to meet full-year guidance.

Dan Coatsworth, head of markets at AJ Bell, attributed the share price slump to disappointment over the lack of upgrades to earnings guidance in the results.

InterContinental Hotels fell despite saying it was on track to meet full-year earnings estimates as it reported a 10% jump in profits driven by better-than-expected demand globally.

IWG fell even as the provider of office space backed its full-year and medium-term expectations thanks in part to cost-cutting measures.

Genuit slumped as it reported a sharp fall in interim profit, but held its expectations for the year, with pricing action, cost control and a strengthening infrastructure pipeline expected to support an improvement from next year.

On the upside, oil giants BP and Shell gushed higher as oil prices rose.

Lion Finance jumped as it hailed a "strong" first half and announced an extension to its share buyback programme.

Bellway reversed earlier losses to trade a little higher as the housebuilder said it built more homes than expected in the year to the end of July, but also cautioned the near-term outlook remained uncertain and called on the government to introduce an immediate cut to stamp duty to boost demand.

Market Movers

FTSE 100 (UKX) 10,867.30 0.04%

FTSE 250 (MCX) 24,707.52 -0.15%

techMARK (TASX) 6,165.89 0.22%

FTSE 100 - Risers

BP (BP.) 534.70p 1.85%

IG Group Holdings (IGG) 1,387.00p 1.69%

Shell (SHEL) 3,349.50p 1.50%

St James's Place (STJ) 1,158.50p 1.32%

Scottish Mortgage Inv Trust (SMT) 1,421.50p 1.14%

Lion Finance Group (BGEO) 12,600.00p 0.96%

GSK (GSK) 1,943.00p 0.93%

Airtel Africa (AAF) 325.80p 0.93%

BT Group (BT.A) 196.50p 0.85%

Compass Group 11 (CPG) 32.44p 0.78%

FTSE 100 - Fallers

Spirax Group (SPX) 7,200.00p -5.82%

Legal & General Group (LGEN) 296.70p -4.53%

M&G (MNG) 350.50p -3.26%

Standard Life (SDLF) 909.50p -2.52%

Prudential (PRU) 1,018.50p -2.25%

JD Sports Fashion (JD.) 91.94p -2.06%

Hiscox Limited (DI) (HSX) 1,780.00p -1.49%

Aviva (AV.) 697.60p -1.41%

Tesco (TSCO) 462.20p -1.41%

Sainsbury (J) (SBRY) 346.80p -1.25%

FTSE 250 - Risers

Ceres Power Holdings (CWR) 439.80p 3.65%

Vistry Group (VTY) 257.00p 3.37%

Patria Private Equity Trust (PPET) 616.00p 3.01%

Harbour Energy (HBR) 258.20p 2.55%

Aston Martin Lagonda Global Holdings (AML) 35.96p 2.51%

IntegraFin Holding (IHP) 391.50p 2.49%

Energean (ENOG) 760.00p 2.22%

Oxford Biomedica (OXB) 488.00p 2.09%

Diversified Energy Company (DI) (DEC) 1,070.00p 1.90%

Ithaca Energy (ITH) 245.50p 1.74%

FTSE 250 - Fallers

Genuit Group (GEN) 292.00p -4.65%

Vesuvius (VSVS) 398.40p -2.41%

Seraphim Space Investment Trust (SSIT) 186.20p -2.21%

International Workplace Group (IWG) 182.20p -2.05%

Playtech (PTEC) 370.20p -1.86%

Greggs (GRG) 1,868.00p -1.79%

Morgan Advanced Materials (MGAM) 251.00p -1.57%

Victrex plc (VCT) 806.00p -1.47%

Halfords Group (HFD) 238.50p -1.45%

Rosebank Industries NPV (ROSE) 345.00p -1.43%