UK equities rallied strongly on Friday as investors responded positively to growing optimism that a diplomatic agreement between the United States and Iran could be within reach, easing concerns over energy prices and geopolitical risk.
The FTSE 100 climbed 1.6% to close at 10,471.7, marking its highest closing level since 27 May. Gains were broad-based across the index, with lower oil prices and improved risk sentiment supporting buying activity throughout the session.
The domestically focused FTSE 250 also advanced 1.6%, recording its strongest single-day percentage gain in more than five weeks as investors rotated into UK-focused stocks.
Market sentiment was boosted by hopes that a potential US-Iran agreement could reduce tensions in the Middle East, helping to drive crude oil prices lower and easing inflation concerns that have weighed on global markets in recent months.
The decline in energy prices also strengthened expectations that central banks may face less pressure to keep interest rates higher for longer, providing additional support for equity markets.
Friday’s rally capped a positive week for UK stocks, with both the FTSE 100 and FTSE 250 posting gains of more than 1% over the five-day trading period.
The strong finish leaves UK equities close to recent highs as investors continue to monitor developments in the Middle East, interest rate expectations and the broader global economic outlook.
