British equities traded cautiously higher on Thursday as diplomatic developments around the US-Iran talks helped steady investor sentiment, offsetting downward pressure from sliding oil prices that hit large energy names.
At 3:35 ET (07:35 GMT), the FTSE 100 was up 0.09%. European peers moved in positive territory as well, with Germany's DAX rising 0.44% and France's CAC 40 advancing 0.11%. The pound held firm at $1.3181, gaining 0.11%.
Markets and sentiment
Markets responded to a string of diplomatic signals that suggested a pause in immediate escalation in the Middle East. That improvement in risk appetite helped offset a slide in energy prices which continued to weigh on the sector's largest constituents.
UK consumer mood registered a small uplift in June. Data from BRC-Opinium showed three-month economic expectations improved to -43 from -48 in May. British Retail Consortium chief Helen Dickinson linked the improvement in part to "a lull in the Middle East conflict at the start of June, easing concerns about energy prices and inflation," while cautioning that "fast moving events in the Middle East and at home could shake consumer confidence."
Diplomacy and regional developments
On the diplomatic front, Secretary of State Marco Rubio completed visits to Kuwait, the UAE and Bahrain, while not visiting Israel, as part of efforts to persuade regional partners to accept a U.S.-Iran ceasefire framework. Rubio sought to reassure skeptical Gulf allies that the United States would not "undermine" their security interests in the negotiations.
Technical talks with Tehran are scheduled to resume in Switzerland on June 29 or 30, with expert-level working groups due to begin on June 30, Rubio said. A central point of contention remains nuclear access. Rubio urged Iran to permit IAEA inspectors in "as soon as possible," saying "that’s a commitment (Iran) made, and it’s one they need to keep," after Tehran pushed back on a UN official's suggestion that inspectors would have full access. The IAEA chief indicated inspections would take place but said the timing was "not essential."
Political and military developments in Washington
In Washington, the Senate late Wednesday rejected the Kaine resolution, a second war powers measure that would have directed the president to remove US forces from hostilities with Iran, by a 50-47 vote. The vote represented a reversal from the previous day when four Republicans had backed an earlier House-passed resolution.
President Trump, accompanied by NATO Secretary General Mark Rutte, dismissed the congressional measures and denied US responsibility for a missile strike on an Iranian girls' school early in the war, saying, "I don’t know that they’re ever going to solve that problem." Separately, the administration requested $87.6 billion in supplemental funding, largely aimed at replenishing resources depleted by the conflict.
Shipping, commodities and sector impact
Vessel movements through the Strait of Hormuz rose sharply, doubling over 24 hours to 34 transits, the busiest level since late February but still below the pre-war daily average of about 110 vessels. The uptick reflected improved sentiment around the ceasefire discussions.
Energy markets retreated. Brent crude fell 1.1% to $73.05 a barrel, while WTI slipped 1% to $69.62, both near their lowest levels since the war began. The fall in crude prices kept pressure on major integrated oil companies, notably BP and Shell. Precious metals also eased: gold futures declined 0.23% to $3,998.45 and spot gold was down 0.42% at $3,982.42.
UK corporate round up
- Halfords - The retailer's FY26 earnings beat forecasts and its FY27 profit is expected toward the top end of analyst estimates, suggesting its turnaround plan is making progress.
- easyJet - The airline rejected a revised £4.93 billion takeover proposal from Castlelake as undervaluing the company, but granted limited due diligence access that could support a higher bid.
- Serco Group - The outsourcing group maintained its FY26 guidance after a strong first half, showing growth, margin expansion, solid cash generation and a growing £12.5 billion pipeline of contracts.
- Moonpig Group - The card and gifts business reported FY26 adjusted profits above forecasts, alongside improved revenue and margins, a 25% dividend increase and plans for up to £65 million of share buybacks in FY27.
Overall, market participants balanced tentative diplomatic progress with the immediate economic effects of lower oil prices. The mixed corporate updates further highlighted divergence across sectors, with retailers and certain services companies reporting stronger operational momentum while energy names remained vulnerable to crude price moves.