The FTSE 100 finished the week on the defensive as the crisis in the Middle East remained stagnant.
The FTSE 100 closed down 77.93 points, or 0.8%, at 10,379.08. The FTSE 250 closed down 181.71 points, or 0.8%, to 22,582.81, while the AIM All-Share fell 5.73 points, or 0.7%, to 796.40.
Over the week, the FTSE 100 fell 2.7%, the FTSE 250 also fell 2.7% and the AIM All-Share fell 1.7%.
The price of oil continued to rise amid few signs of a breakthrough in the Middle East crisis.
AFP reported that Iranian Foreign Minister Abbas Araghchi is expected to arrive in Islamabad on Friday night, citing an official source in Pakistan, without providing details on who he would meet.
Pakistan's capital has been preparing for an anticipated second round of talks between the United States and Iran, but it was unclear whether Araghchi and his accompanying delegation would meet any American officials to discuss the war in the Middle East.
The BBC reported that the suggestion coming from Iran is that these are bilateral talks with Pakistan, not a meeting with the United States.
Writing in
U.S. Defense Secretary Pete Hegseth said Iran has an opportunity to “reach a good and wise deal,” adding that the U.S. naval blockade of Iranian ports “is growing and becoming global.”
Hegseth said the United States is not “eager” to reach a deal and that “the ball is in its place.” [Iran’s] court”.
Brent oil was quoted on Friday afternoon at $105.78 a barrel, compared to $103.25 on Thursday at the close of the London Stock Exchange.
In European equities on Friday, the CAC 40 in Paris closed down 0.8% and the DAX 40 in Frankfurt closed down 0.1%.
The environment was better in the United States. In New York, the Dow Jones Industrial Average was down 0.4%, but the S&P 500 was up 0.5% and the Nasdaq Composite was up 1.2%.
David Morrison, senior market analyst at Trade Nation, explained that the war in the Gulf is hitting Europe and the United Kingdom harder than the United States.
“The former depend on imported energy in a way that the US does not. While the US still must deal with higher crude oil prices, it has few concerns about depleting supplies,” he noted.
On Wall Street, Intel was the star of the show, soaring 23% after better-than-expected first-quarter results and guidance, reporting “unprecedented” demand for its chips.
The 10-year US Treasury yield stretched to 4.32% on Friday from 4.29% on Thursday. The 30-year U.S. Treasury yield widened to 4.92% from 4.89%.
The pound fell to $1.3497 on Friday afternoon from $1.3500 on Thursday. Against the euro, sterling fell to 1.1532 euros from 1.1551 euros.
In the UK, retail sales rose faster than expected in March as fuel sales soared 6.1% amid rising oil prices.
According to the Office for National Statistics, retail sales volume increased by 0.7% in March, contrary to market consensus that there will be no growth.
Total retail sales excluding auto fuel rose 0.2% mom, in line with expectations cited by FXStreet.
Danni Hewson, head of financial analysis at AJ Bell, explained that the figures show that rising petrol and diesel prices are “consuming household budgets”.
“People can only spend a pound once and if they choose to spend more than usual on fuel, they will have less to spend on other purchases,” he explained.
A separate report showed that UK businesses believe food inflation could rise by up to 7% this year.
The conflict in the Middle East has “eroded” confidence that the UK economy will improve later this year, according to a Bank of England survey.
The Decision Maker Panel survey showed that companies expected to increase their prices by 3.8% over the next 12 months, based on data for the three months to April.
This is 0.3 percentage points higher than expected for the three months to March.
Meanwhile, Bank of England Deputy Governor Sarah Breeden told the BBC on Friday that the UK central bank expects stock markets around the world to fall as share prices do not reflect the many risks facing the global economy.
Ms Breeden, who is also the Bank's head of financial stability, said: “There are a lot of risks and yet asset prices are at record highs. We hope there will be an adjustment at some point.”
The euro traded lower against the dollar, falling to $1.1703 on Friday from $1.1708 on Thursday. Against the yen, the dollar was trading at 159.55 yen, up from 159.50 yen.
On the FTSE 100, packaging company Mondi fell 11% as it missed profit forecasts in the first quarter.
The Weybridge-based packaging company said on Friday that underlying earnings before interest, tax, depreciation and amortization, including forestry fair value, fell 27% to €212 million for the first quarter ended March 31, from €290 million a year earlier.
JD Sports Fashion fell 1.9% as the Financial Times said a board rift led to the departure of chairman Andrew Higginson this week.
The Financial Times reported that Higginson resigned as chairman of JD Sports after pushing for CEO Regis Schultz to be ousted and failing to win unanimous backing for the move.
But JD Sports told Alliance News that Schultz has the “continued support” of his board of directors.
A JD Group spokesperson said: “Andy and the board have mutually agreed that this is the right time for a change of chairman; there has been no disagreement over the board's continued support for the chief executive. The board is grateful for the valuable role Andy has played during his tenure at the company.”
Airlines headed south amid rising oil prices and fears over jet fuel supplies.
Wizz Air fell 6.0%, easyJet 2.3% and British Airways owner IAG 1.4%.
Gold was trading at $4,718.34 an ounce on Friday, down from $4,731.39 at the same time on Thursday.
The biggest risers on the FTSE 100 were British American Tobacco, which rose 96.00 pence to 4,302.00 pence, Intercontinental Hotels Group, which rose 3.10 pence to 146.00 pence, London Stock Exchange Group, which rose 180.00 pence to 9,992.00 pence. 5.35p 347.00p.
The biggest fallers on the FTSE 100 were Mondi, down 93.60p to 748.20p, Babcock International, down 54.50p to 1,131.50p, Antofagasta, down 145.00p to 3,686.00p. Fashion, down 2.12p to 69.94p.
Monday's global economic calendar includes German consumer confidence data. Interest rate decisions in the US, Europe, the UK and Japan will follow later in the week. Inflation data will be released in Australia and the euro area.
Next week's local corporate calendar includes first-quarter results from oil majors BP and Shell, pharmaceutical firms GSK and AstraZeneca and banks Barclays, NatWest and Lloyds.
Contributed by Alliance News
