London pre-open: Stocks to rise despite escalating US-Iran tensions

(Sharecast News) - London stocks were set to rise at the open on Thursday despite escalating tensions between the US and Iran, following heavy losses in the previous session.

The FTSE 100 was called to open around 40 points higher.

US Central Command said in a statement that it had struck around 90 Iranian military targets including air defence systems, coastal surveillance assets, missile and drone storage sites, naval capabilities, and military logistics infrastructure along Iran's coastline.

This followed strikes on approximately 80 Iranian military targets on 7 July, including more than 60 Islamic Revolutionary Guard Corps small boats, "to impose heavy costs for Iran violating the ceasefire by attacking three commercial vessels navigating the Strait of Hormuz".

Ipek Ozkardeskaya, senior analyst at Swissquote, said: "The news is not brilliant: Middle East tensions are flaring up, US President Donald Trump declared the ceasefire over, and the US continued bombing Iran last night.

"Washington also revoked the recent easing of Iranian sanctions, meaning that Iran will not be able to sell the tens of millions of barrels currently at sea, while Tehran said it will launch a 'large-scale retaliatory' operation against US bases across the Gulf region. Meanwhile, Russia is limiting some energy exports to avoid domestic shortages amid Ukrainian attacks on Russian energy facilities."

On home shores, a survey showed house prices remained subdued in June as the cost of living and wider geopolitical tensions weighed on sentiment.

The latest residential market survey from the Royal Institution of Chartered Surveyors showed house prices largely unchanged month-on-month, with a negative balance of -33. The balance was -34 in April and -35 in May.

New buyer enquiries improved on May's -34 but remained in negative territory at -29. Newly-agreed sales stood at -32.

Looking ahead, and near-term price expectations were also subdued. However, at -32 they were less markedly negative than May's -44, and longer-term, the 12-month expectations balance ticked up two points to 8.

Near-term sales expectations also improved, at -16, well above March's recent low of -34.

Tarrant Parsons, head of market research and analysis at Rics, said: "June's survey result offers some cautious encouragement that the worst of the slowdown in market activity may be beginning to pass.

"That said, any nascent improvement remains fragile, and is now being tested by renewed political uncertainty on the domestic front.

"While the Bank of England left interest rates unchanged, uncertainty around the outlook for inflation and borrowing costs continues to weigh on sentiment. Until there is greater clarity over both the political backdrop and the path of interest rates, house market activity is likely to remain relatively subdued."

In corporate news, Computacenter boosted full-year guidance on the back of strong second-quarter trading, including bumper demand from hyperscalers.

The technology and services provider said trading in the three months to 30 June had been ahead of expectations, building on an "excellent" first quarter. As a result, interim profits are likely to be around double the previous year, and full-year results were forecast to be "comfortably ahead" of market expectations.

Gambling software maker Playtech said it expected annual earnings to be "significantly" above estimates after a strong performance in the first six months of the year.

The company now expects adjusted EBITDA for the year to December 2026 to be at least �270m compared with analyst estimates of �205m to �225m.