London stocks are set to open lower on Friday as renewed geopolitical uncertainty in the Middle East dampens investor sentiment, despite signs of progress in US-backed peace negotiations.
Futures point to the FTSE 100 opening around 63.8 points, or 0.8%, lower after the blue-chip index gained 0.7% on Thursday, closing at 10,529.89.
Markets are weighing reports that Iran has attacked a container ship in the Strait of Hormuz, with the Persian Gulf Strait Authority warning that vessels travelling outside its designated routes may no longer receive safe passage guarantees. The development has raised fresh concerns over one of the world’s most strategically important shipping lanes.
At the same time, diplomatic efforts continue, with US-mediated talks between Israel and Lebanon extended for a further day as negotiators seek to reach a lasting agreement.
Wall Street ended Thursday on a mixed note, with the Dow Jones Industrial Average edging 0.1% higher while the S&P 500 was little changed and the Nasdaq Composite slipped 0.5%.
Asian markets were broadly weaker overnight. Japan’s Nikkei 225 fell 4.2%, Hong Kong’s Hang Seng lost 1.6% and China’s Shanghai Composite declined 1.3%, although Australia’s ASX 200 bucked the trend with a modest 0.2% gain.
Oil prices remained below recent conflict highs despite the renewed tensions. Brent crude traded around $74.30 a barrel, while gold eased to approximately $4,009 an ounce as investors monitored developments in the region.
On the corporate front, investors will be watching full-year results from Cranswick, Thruvision and Solid State, while the economic calendar includes US goods trade balance and wholesale inventory data later in the day.
