FTSE 100 Materially Higher Open on Trump Iran-Strikes Cancellation; Brent Pulls Back to $96.50, VIX Drops 11%
London stocks are set to open materially higher Friday at around 10,435 on Trump’s retracted Kharg threat and “deal nearly done” framing. Brent crude fell 3% to $96.50 a barrel from Thursday’s $99.50 close. UK 10-year gilt yields ease to 5.02%; sterling firms to $1.3415. The VIX is down 11% to 26.50 as the war-risk premium materially eases. Defence stocks BAE Systems, Babcock and Melrose are likely to give back Thursday’s gains; oil majors BP and Shell mixed on the Brent pullback.
The Friday open reflects the structural Trump-cancellation relief scenario. If the cancellation holds through the weekend and Iran formally re-engages with the framework deal, Brent likely eases to $88-92 within 48-72 hours and the FTSE could push toward 10,500. If the Iranian Hormuz-reestablishment closure operationalises and Tehran follows through on the “no agreement” framing, Brent likely tests $100-105 and the FTSE falls back. The 5.02% gilt yield is just above the 5% line; the Bank of England MPC’s next decision later this month is the binding macro variable. The Ofgem October price-cap reset depends on Brent staying in the $88-95 range through mid-summer; the current $96.50 trajectory is at the upper bound.