London midday: FTSE in the red as oil prices rise; US midterms eyed

(Sharecast News) - London stocks were still in the red by midday on Tuesday following a US tech selloff and amid rising oil prices, as investors eyed the US midterm elections.

The FTSE 100 was down 0.6% at 10,698.77, while Brent crude was up 1.6% at $106.47 a barrel and West Texas Intermediate was 2.1% higher at $98.47 following reports the US has launched strikes on Iran's Qeshm Island in the Strait of Hormuz.

On Wall Street, the Nasdaq closed 1.1% lower on Monday as tech stocks were hit once again by worries about AI spending.

Susannah Streeter, chief investment strategist at Wealth Club, said: "The US midterm elections kick off with a fresh wave of strikes on Iran, with Trump doubling down on his foreign policy despite deep apprehension across Middle America.

"Though the strikes on Iran's Qeshm Island appear limited, it's still bullish action, and runs against the message of greater diplomacy which the administration had been pushing prior to the attacks.

"Oil prices are on the rise again, with Brent crude heading back above $106 a barrel, up around 2%. However, the gains for now appear relatively limited, with hopes still swirling that negotiations will come to fruition, and that another big escalation in the conflict will be avoided."

Streeter said investors remain "highly wary" about the high sums being poured into AI infrastructure without evidence that returns will compensate for the "eye-watering" expenditure.

As far as the midterms are concerned, tentative results will be available by Wednesday morning, but final results could take weeks. Kathleen Brooks, research director at XTB, said the polls continue to suggest that it will be a clean sweep for the Democrats on Tuesday evening, and they will win control of both houses of Congress.

"Essentially this means gridlock for US politics for the next two years," she said. "This is good news for stocks, which tend to rally in the year after an election, but it also means that any attempt by Democrats to bring the war to an end and reduce pressure on the oil price, could be vetoed by the President."

In equity markets, Associated British Foods fell as it posted a sharp decline in annual profits. The Primark owner said challenging conditions hit both its grocery and retail businesses, and warned of further falls to come, with group adjusted operating profits and adjusted earnings per share in the current year to come in below 2026.

Coca-Cola Europacific Partners was also weaker despite backing its full-year guidance and posting a 6.5% increase in third-quarter revenue.

Heavily-weighted miners were under the cosh, with Anglo American, Antofagasta and Glencore among the worst performers as copper prices slid.

On the upside, Hiscox rallied as the specialist insurer said group insurance contract written premiums rose 9.5% in the first nine months of the year, driven by accelerating momentum in the retail segment.

British Gas owner Centrica rose after Jefferies upgraded the stock to 'buy' from 'hold' and lifted the price target to 200p from 190p. It said the market is overlooking the visibility and growth embedded in the business.

Drax surged after saying it had signed an agreement to develop a strategic partnership with Brookfield and Radiant, Brookfield's UK-headquartered AI infrastructure platform, to jointly develop, deliver and operate an AI data centre on its power station estate in the north of England.

IWG also gained as the workspace provider hailed a strong third quarter, with revenue up 12% year-on-year.

Market Movers

FTSE 100 (UKX) 10,698.77 -0.58%

FTSE 250 (MCX) 24,692.39 -0.42%

techMARK (TASX) 6,285.50 -0.27%

FTSE 100 - Risers

Hiscox Limited (DI) (HSX) 1,940.00p 3.19%

Centrica (CNA) 153.80p 2.67%

Lion Finance Group (BGEO) 12,210.00p 1.33%

Balfour Beatty (BBY) 886.50p 1.20%

Vodafone Group (VOD) 118.25p 1.11%

3i Group (III) 2,555.00p 1.11%

Smith & Nephew (SN.) 1,114.50p 0.81%

Haleon (HLN) 325.70p 0.74%

ICG (ICG) 1,919.00p 0.74%

Airtel Africa (AAF) 268.60p 0.52%

FTSE 100 - Fallers

Associated British Foods (ABF) 1,882.50p -3.11%

Anglo American (AAL) 3,713.00p -2.82%

The Sage Group (SGE) 1,148.00p -2.54%

Fresnillo (FRES) 2,278.00p -2.48%

Coca-Cola Europacific Partners (DI) (CCEP) 8,375.00p -2.45%

Experian (EXPN) 2,959.00p -2.28%

Barratt Redrow (BTRW) 327.50p -2.09%

Antofagasta (ANTO) 3,182.00p -2.03%

Glencore (GLEN) 509.20p -1.81%

Next (NXT) 15,140.00p -1.72%

FTSE 250 - Risers

Drax Group (DRX) 877.50p 8.59%

Rank Group (RNK) 91.20p 4.82%

International Workplace Group (IWG) 206.00p 4.21%

Ceres Power Holdings (CWR) 268.40p 2.52%

TBC Bank Group (TBCG) 4,650.00p 2.51%

Telecom Plus (TEP) 929.00p 1.98%

Baltic Classifieds Group (BCG) 2.34p 1.83%

AEP Plantations (AEP) 154.60p 1.31%

Lancashire Holdings Limited (LRE) 696.50p 1.31%

Shawbrook Group (SHAW) 285.00p 1.24%

FTSE 250 - Fallers

THG (THG) 39.76p -4.91%

Wetherspoon (J.D.) (JDW) 1,042.00p -3.43%

Endeavour Mining (EDV) 3,617.00p -3.19%

Bridgepoint Group (Reg S) (BPT) 410.20p -3.07%

Kainos Group (KNOS) 1,253.00p -2.86%

Ocado Group (OCDO) 325.80p -2.74%

Young & Co's Brewery 'A' Shares (YNGA) 1,172.00p -2.66%

Hochschild Mining (HOC) 434.60p -2.55%

TP Icap Group (TCAP) 313.40p -2.55%

B&M European Value Retail (BME) 276.20p -2.54%