12th Jun 2026 12:16
(Alliance News) - Stock prices in London were sharply higher at midday Friday, with airline stocks leading gains after reports of progress towards a deal to reopen the Strait of Hormuz sent oil prices tumbling and boosted risk appetite across global markets.
The FTSE 100 index was up 100.26 points, 1.0%, at 10,404.14. The FTSE 250 was up 338.04 points, 1.5%, at 23,308.68, and the AIM all-share was up 13.79 points, 1.8%, at 784.75.
The Cboe UK 100 was up 0.9% at 1,033.09, the Cboe UK 250 was up 1.4% at 20,056.41, and the Cboe small companies was down 0.2% at 18,642.98.
In European equities on Friday, the CAC 40 in Paris was up 1.9%, while the DAX 40 in Frankfurt was up 1.8%.
Investor sentiment improved after reports that the US and Iran had agreed a memorandum of understanding that would see the Strait of Hormuz reopen within 30 days, according to Iran's semi-official Mehr news agency.
The prospect of easing tensions in the Gulf fuelled a broad rally in stocks and bonds while weighing heavily on oil prices.
US President Donald Trump said he had called off "very hard" strikes on Iran that had been due to take place overnight and claimed a deal had been agreed. He added that Iran's supreme leader had approved the text and that the time and place of the signing would be "announced shortly".
However, Tehran struck a more cautious tone. Iran's foreign ministry said a final decision had not yet been reached, dismissing media speculation and criticising Washington for repeatedly changing its position. Other Iranian officials also questioned suggestions that an agreement was imminent.
Brent oil was quoted at USD87.70 a barrel at midday in London, down sharply from USD92.95 on Thursday.
The fall in crude prices weighed on energy majors. BP dropped 4.9%, while Shell lost 3.6%.
Airline shares were among the strongest performers on hopes that lower fuel costs would support profitability. International Consolidated Airlines Group led the FTSE 100, rising 6.6%. On the FTSE 250, Wizz Air surged 10%, while easyJet gained 3.2%.
The pound was quoted at USD1.3418 midday Friday, higher than USD1.3342 on Thursday. Against the euro, sterling rose to EUR1.1582 from EUR1.1578 a day earlier.
The euro stood at USD1.1578, higher against USD1.1522. Against the yen, the dollar traded at JPY160.11, down from JPY160.48.
Back in the UK, official data showed the economy contracted in April, matching expectations.
The Office for National Statistics said monthly gross domestic product fell 0.1% in April after growth of 0.3% in March and 0.4% in February, in line with the FXStreet-cited consensus.
The decline reflected a 0.2% contraction in the services sector, partly offset by a 0.1% increase in construction activity. Production output was unchanged.
Despite the monthly setback, GDP grew 0.7% in the three months to April compared with the three months to January, accelerating from growth of 0.6% in the three months to March and 0.5% in the three months to February.
Stocks in New York were called higher. The Dow Jones Industrial Average was called up 0.8%, the S&P 500 index up 0.6%, and the Nasdaq Composite up 0.6%.
Attention on Wall Street is focused on the debut of SpaceX, which is set to become the largest stock market listing in history.
The Elon Musk-founded rocket company is due to begin trading on Nasdaq later Friday after raising USD75 billion through its initial public offering.
The flotation values SpaceX at around USD1.75 trillion, making it the largest IPO ever completed and potentially putting Musk on course to become the world's first trillionaire.
UK retail investors were able to participate in the listing through the Financial Conduct Authority's new POP operator framework.
Marex Financial offered access to the IPO via its Winterflood Retail Access Platform. According to Marex, UK retail investors purchased 2.7 million shares at a sterling equivalent price of GBP100.65, representing GBP271.4 million of demand.
The yield on the US 10-year Treasury was quoted at 4.46% on Friday morning, narrowed from 4.52% on Thursday. The yield on the US 30-year Treasury slimmed to 4.95% from 5.00%.
Back in London, Barclays rose 4.8% after announcing that its subsidiary Barclays Bank UK had agreed to acquire GoHenry from Acorns Grow.
GoHenry operates a money management platform aimed at children and teenagers aged between six and 18. Completion is expected in the fourth quarter of 2026.
Barclays said the acquisition is expected to reduce its common equity tier 1 ratio by around five basis points on completion but will have no impact on its financial guidance or medium-term targets.
Shares in London Stock Exchange Group were 0.4% lower after FTSE Russell announced plans to launch a new global equity benchmark for US investors.
The proposed Russell 9000 global index will combine the Russell 3000 US index with Russell 3000 developed world ex-US and Russell 3000 emerging markets indices.
FTSE Russell said the index is designed to simplify global equity allocations by applying a consistent methodology across regions.
"The Russell 9000 global index builds on the strength and familiarity of the Russell US indexes, extending a transparent and rules-based approach to a global scale," said Gerald Toledano, head of Equity & Multi Assets at FTSE Russell.
Meanwhile, Leeds-based homewares retailer Dusk is planning to start trading on the London Stock Exchange, Sky News reported just before noon.
The firm is expected to be valued in the region of around GBP300 million.
Gold was quoted at USD4,215.00 an ounce, up from USD4,079.75 late Thursday.
Meanwhile, German inflation data confirmed a modest easing in price pressures.
According to final figures from the Federal Statistical Office, consumer price inflation slowed to 2.6% in May from 2.9% in April. Consumer prices fell 0.2% on a monthly basis after rising 0.6% in April.
On a harmonised basis, German inflation eased to 2.7% from 2.9%, while prices slipped 0.1% month-on-month.
Federal Statistical Office President Ruth Brand noted that energy prices remained elevated due to the Iran war, although a reduction in fuel taxes introduced at the start of May helped moderate price increases.
Still to come on Friday's economic calendar is the University of Michigan consumer sentiment reading from the US, alongside Canadian manufacturing sales data.
By Eva Castanedo, Alliance News reporter
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