(Sharecast News) - London stocks edged lower in early trade on Thursday, with oil prices up as tensions between the US and Iran continued to escalate, and as Alphabet and Tesla slumped in after-hours trading following quarterly results.
At 0825 BST the FTSE 100 was down 0.3% at 10,689.97. Brent crude was up 3.2% at $97.06 a barrel and West Texas Intermediate was 2.5% higher at $88.99 following reports that Iranian-backed Houthi militants targeted two Saudi oil tankers in the Red Sea and after Donald Trump threatened once again to bomb Iranian infrastructure.
In a post on Truth Social on Wednesday, the US president said: "From this point forward, any time the Islamic Republic of Iran shoots at a ship in the Strait of Hormuz, whether it be by Missile, Rocket, Drone, or any other device or weapon, the United States will bomb and destroy ONE BRIDGE OR POWER PLANT, including those located next to, or in, the Capital City of Tehran."
Investors were also mulling second-quarter earnings from Tesla and Google-owner Alphabet released overnight.
Patrick Munnelly at Tickmill Group said: "Alphabet's shares fell more than 3% in after-hours trading after capital expenditure came in higher than expected, reviving the familiar debate over whether AI spending is creating future earnings power or simply raising the investment hurdle. Tesla dropped around 4%, while IBM also softened after earnings.
"The message from US megacap tech is less clean than the Asian chip rally suggests: investors like AI exposure, but they are starting to interrogate the cost of staying in the race. That distinction matters. For Asian semiconductor names, higher AI capex is demand. For US platform companies, higher AI capex is both ambition and margin pressure. The same theme can therefore be bullish for suppliers and more ambiguous for spenders."
On home shores, new prime minister Andy Burnham announced a 20% cut in business rates for pubs, clubs and live music venues across England. The move, which will cost around 100m a year, will be partly funded by reviewing reliefs for "anti-social businesses" such as vape shops.
On the corporate front, there was a raft of releases for investors to sink their teeth into.
Segro was the standout gainer on the FTSE 100, having announced after the close of markets on Wednesday that it would be minded to recommend a 14bn final takeover approach by US logistics giant Prologis should a firm offer be made.
3i Group was in the black as it said its largest holding, Dutch discount retailer Action, delivered a strong financial performance in the first quarter.
Relx ticked up as the provider of information-based analytics and decision tools reaffirmed its full-year outlook and posted a rise in first-half revenue and profit.
Aston Margin surged after the luxury car maker announced late on Wednesday a new 550m debt financing with BlackRock-owned HPS Investment Partners, strengthening its financial position and allowing it to execute on its long-term growth ambition.
Jupiter Fund Management advanced as it hailed a strong first half, with underlying pre-tax profit up 67% and 0.7bn of net new business.
EasyJet was in focus as it reported a drop in third-quarter headline pre-tax profit to 85m from 286m in the same period a year earlier as it was hit by high fuel prices and a reduction in consumer demand following the onset of the conflict in the Middle East.
Shares jumped, however, in what was likely a recovery from heavy losses on Wednesday following a report the European Union is preparing a review of airline ownership rules to prevent foreign investors from gaining effective control of carriers - a move that could threaten US bids for the budget airline.
On the downside, British Gas owner Centrica fell as it posted softer first-half earnings, weighed down by production outages and Spirit Energy disposals.
BT Group and Mitchells & Butlers were also lower after trading updates.
Market Movers
FTSE 100 (UKX) 10,689.97 -0.25%
FTSE 250 (MCX) 23,842.74 -0.35%
techMARK (TASX) 5,932.05 -0.41%
FTSE 100 - Risers
SEGRO (SGRO) 962.20p 7.00%
3i Group (III) 2,695.00p 5.86%
Anglo American (AAL) 3,685.00p 5.58%
Relx plc (REL) 2,533.00p 3.30%
Spirax Group (SPX) 6,985.00p 1.82%
BP (BP.) 548.50p 1.58%
British Land Company (BLND) 445.00p 1.42%
Antofagasta (ANTO) 3,795.00p 1.41%
Land Securities Group (LAND) 710.00p 1.28%
BAE Systems (BA.) 1,935.50p 0.99%
FTSE 100 - Fallers
Rentokil Initial (RTO) 428.10p -3.75%
Centrica (CNA) 172.95p -2.85%
BT Group (BT.A) 192.50p -2.34%
Burberry Group (BRBY) 1,036.00p -1.98%
Whitbread (WTB) 2,393.00p -1.92%
Scottish Mortgage Inv Trust (SMT) 1,325.00p -1.60%
Diageo (DGE) 1,548.50p -1.55%
Airtel Africa (AAF) 341.40p -1.55%
SSE (SSE) 2,462.00p -1.44%
Haleon (HLN) 361.40p -1.39%
FTSE 250 - Risers
Aston Martin Lagonda Global Holdings (AML) 38.22p 8.33%
Jupiter Fund Management (JUP) 156.20p 4.53%
Oxford Instruments (OXIG) 2,992.00p 4.31%
Trustpilot Group (TRST) 270.00p 2.82%
Grainger (GRI) 181.20p 2.78%
Ashoka India Equity Investment Trust (AIE) 255.00p 2.62%
easyJet (EZJ) 598.60p 2.49%
PPHE Hotel Group Ltd (PPH) 1,600.00p 2.30%
Volution Group (FAN) 647.00p 2.20%
HGCapital Trust (HGT) 394.00p 2.07%
FTSE 250 - Fallers
Mitchells & Butlers (MAB) 261.00p -6.36%
4Imprint Group (FOUR) 3,756.00p -5.20%
Pennon Group (PNN) 472.20p -4.64%
Pets at Home Group (PETS) 190.00p -4.19%
CVS Group (CVSG) 1,243.00p -3.99%
Avon Technologies (AVON) 1,664.00p -3.93%
Dr. Martens (DOCS) 73.00p -3.44%
Mondi (MNDI) 718.20p -3.12%
Morgan Sindall Group (MGNS) 4,818.00p -2.93%
Syncona Limited NPV (SYNC) 104.00p -2.80%
17.14 (0.16%)
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