FTSE 100 Nears Record as Israel-Iran truce hopes collapse

Oil prices rose nearly 2% in Asian trading on Tuesday, bringing total gains to 7.5% since Friday as hopes for a ceasefire between Israel and Iran faded following renewed missile attacks. US futures declined and European markets were soft, while the dollar held steady as a safe haven. The Bank of Japan kept interest rates at 0.5% and said it would slow bond tapering from the next fiscal year, prompting little market reaction.

Equities

The FTSE 100 rose 0.3% on Monday to close at 8,875.22, coming within a few points of its all-time intraday high. Sentiment was lifted by reports that Iran was seeking a ceasefire with Israel, which helped reduce concerns about disruptions to oil supply. The FTSE 250 gained 0.5%, with several midcap stocks making strong gains.

Entain led the FTSE’s risers, jumping 15.3%—its biggest daily rise since September 2021. The company was boosted by an upgraded forecast from its US joint venture, BetMGM, which raised its annual revenue and core earnings guidance.

Metro Bank climbed 18.4% following reports of a possible takeover by private equity firm Pollen Street Capital. The travel and leisure sector gained 3.3% overall, helping support broader gains in the index. Meanwhile, precious metals miners fell 3%, dragged lower by weaker gold prices.

In the US, the S&P 500 rose 0.94% to 6,033.11, the Dow climbed 0.75% to 42,515.09, and the Nasdaq advanced 1.52% to 19,701.21—its biggest daily percentage gain in three weeks. The moves came as oil prices fell more than 1% following Friday’s sharp 7% rise, with investors reacting to signs of a potential de-escalation in the conflict between Israel and Iran.

Among individual stocks, Advanced Micro Devices surged 8.81% after analysts at Piper Sandler raised their price target, driving a 3% gain in the broader semiconductor index.

US Steel rose 5.1% after Donald Trump approved Nippon Steel’s $14.9 billion acquisition bid. Sarepta Therapeutics plunged 42.1% after the company reported a second patient death linked to its gene therapy treatment for muscular dystrophy.

UPS and FedEx both rose 1.1% following the launch of Trump Mobile, a self-branded mobile network from the Trump Organisation, which named both logistics companies as shipping partners.

Forex & Commodities

The yen rose 0.2% to 144.50 per dollar on Tuesday following the Bank of Japan’s latest policy decision. The central bank held interest rates steady and signalled a slower pace of balance sheet reduction from 2026.

Investors are watching Governor Kazuo Ueda’s post-meeting briefing for more direction, especially regarding inflation risks and ongoing US trade tensions. The BOJ cited uncertainty in global markets, including the conflict in the Middle East and the impact of US tariffs, as key considerations.

The US dollar was largely flat, with the dollar index holding at 98.13. Sterling last traded at $1.3576, while the euro was steady at $1.1562. The Australian dollar rose 0.13% to $0.6533, and the New Zealand dollar edged up 0.1% to $0.6065. Currency markets remained cautious ahead of the US Federal Reserve’s interest rate decision on Wednesday.

Gold rose 0.3% to $3,392.29 an ounce as demand increased on heightened geopolitical tensions. The price gains followed news of fresh Israeli strikes in Tehran and US President Donald Trump urging the evacuation of Iran’s capital. Spot silver also rose 0.3% to $36.43 per ounce, while platinum and palladium were steady.

Oil prices rose on Tuesday, with Brent crude up 0.5% at $73.57 a barrel and WTI climbing 0.4% to $72.06. Both had gained over 2% earlier in the session before paring back. Monday’s decline of more than 1% followed hopes of a truce between Israel and Iran, but renewed conflict and Trump’s warning to evacuate Tehran kept markets uneasy. Iran remains a key OPEC producer, and concerns persist over possible supply disruptions.