London open: Stocks nudge down, oil rises as Hormuz impasse drags on

(Sharecast News) - London stocks nudged lower in early trade on Tuesday, while oil prices rose 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.

At 0830 BST, the FTSE 100 was down 0.1% at 10,856.88, while Brent crude was up 1.6% at $89.08 a barrel and West Texas Intermediate was also 1.6% higher, at $83.47.

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."

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

Oil giants BP and Shell were among the top gainers on the FTSE 100 as oil prices rose.

On the downside, Spirax Group tumbled even as it posted a rise in full-year profit and revenue and said it was on track to meet full-year guidance.

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.

The Holiday Inn owner said revenue per available room - a key industry metric - grew 4.1% as trading in the US accelerated in the second quarter, growth in Greater China continued and a good performance elsewhere in Europe and Asia offset challenges in the Middle East. Operating profit came in at $665m.

Bellway dipped 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.

IWG tumbled 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.

Market Movers

FTSE 100 (UKX) 10,856.88 -0.05%

FTSE 250 (MCX) 24,751.58 0.03%

techMARK (TASX) 6,154.81 0.04%

FTSE 100 - Risers

Lion Finance Group (BGEO) 13,070.00p 4.24%

BP (BP.) 532.00p 1.64%

Shell (SHEL) 3,330.00p 1.17%

Airtel Africa (AAF) 324.80p 0.99%

Vodafone Group (VOD) 117.40p 0.90%

BT Group (BT.A) 196.05p 0.79%

Scottish Mortgage Inv Trust (SMT) 1,411.00p 0.75%

Melrose Industries (MRO) 490.30p 0.72%

Centrica (CNA) 154.30p 0.68%

Babcock International Group (BAB) 1,195.50p 0.63%

FTSE 100 - Fallers

Spirax Group (SPX) 7,280.00p -5.69%

M&G (MNG) 354.80p -2.29%

InterContinental Hotels Group (IHG) 152.00p -1.80%

Legal & General Group (LGEN) 304.20p -1.41%

Prudential (PRU) 1,024.50p -1.06%

Weir Group (WEIR) 2,728.00p -1.02%

IMI (IMI) 3,118.00p -0.70%

Smiths Group (SMIN) 2,658.00p -0.60%

Standard Life (SDLF) 922.00p -0.59%

Metlen Energy & Metals (MTLN) 50.50p -0.54%

FTSE 250 - Risers

Bloomsbury Publishing (BMY) 667.00p 3.73%

Hansa Investment Company Limited (DI) (HAN) 338.00p 3.68%

PPHE Hotel Group Ltd (PPH) 1,508.00p 3.57%

Raspberry PI Holdings (RPI) 694.25p 3.37%

Pets at Home Group (PETS) 216.00p 3.35%

Trustpilot Group (TRST) 289.40p 3.07%

Patria Private Equity Trust (PPET) 616.00p 3.01%

Aston Martin Lagonda Global Holdings (AML) 36.46p 2.62%

Ceres Power Holdings (CWR) 431.80p 2.42%

WH Smith (SMWH) 453.80p 2.39%

FTSE 250 - Fallers

International Workplace Group (IWG) 170.30p -7.38%

Genuit Group (GEN) 282.00p -7.21%

CMC Markets (CMCX) 670.00p -3.18%

Rank Group (RNK) 99.10p -3.01%

RHI Magnesita N.V. (DI) (RHIM) 2,990.00p -2.45%

Derwent London (DLN) 2,084.00p -2.40%

SDCL Efficiency Income Trust (SEIT) 38.05p -1.55%

Harworth Group (HWG) 178.20p -1.55%

Vietnam Enterprise Investments (DI) (VEIL) 713.00p -1.52%

Schroder Asia Pacific Fund (SDP) 805.00p -1.47%