London open: FTSE nudges up, oil falls on Israel-Lebanon ceasefire

(Sharecast News) - London stocks nudged up in early trade on Thursday as oil prices fell on news that Israel and Lebanon have agreed a US-brokered ceasefire.

At 0850 BST, the FTSE 100 was up 0.1% at 10,345.06, while Brent crude was down 1% at $96.88 a barrel on news of the ceasefire, which is contingent on a complete cessation of fire from Iran-backed Hezbollah and the evacuation of all Hezbollah operatives from the South Litani area.

"The two sides agreed with the guidance of the United States to swiftly advance the creation of pilot zones in which the Lebanese armed forces will take exclusive control of the territory to the exclusion of all non-state actors," the US State Department said. "These steps will enable progress towards a comprehensive peace and security agreement."

Israel and Lebanon will reconvene on 22 June "with a view toward reaching a comprehensive agreement", the US said, adding that it has agreed to continue facilitating communication between the two parties.

Rabobank pointed out: "Hezbollah, who operates independently from (and often against the interests of) the Lebanese Government, has not yet indicated that they agree to the terms of the ceasefire."

As far as the US-Iran conflict is concerned, Richard Hunter, head of markets at Interactive Investor, said: "There have been numerous reports of renewed strikes between the US and Iran, mostly drone-driven, and there is little evidence to suggest that any meaningful progress is being made on negotiations, despite the President's protestations (again) that something could happen 'this weekend'."

In equity markets, CMC Markets surged after saying it expects fiscal 2027 net operating income to increase by at least 17% to between �460m and �480m as it posted a rise in profits for the 12 months to the end of March. Pre-tax earnings grew 20% to �101.3m and net operating income 15% to �392.6m driven by volatile markets.

Mitie Group rallied after saying it had started the current year on the front foot, after posting a jump in annual earnings. Revenues at the facilities manager rose 10.5% in the year to 31 March, to �5.6bn, including 5.3% organic growth driven primarily by new contract wins and scope increases. That helped lift adjusted operating profits 13% to �264m.

On the downside, Sainsbury's, Vodafone, Marks & Spencer and LondonMetric all lost ground as they traded without entitlement to the dividend.