Markets Open Cautiously Ahead of Iran Doha Talks; Gilt Yields Edge Lower
UK and European markets opened cautiously Tuesday with all eyes on the Iran-US Doha talks later in the day. The FTSE 100 opened modestly higher at 10,672. Brent crude eased a little further to $86.50 a barrel. UK 10-year gilt yields edged lower to 4.88%, extending Monday’s post-Burnham speech bond-market rally. Sterling firmed slightly to $1.3225. The Bank of England’s August rate decision — previously seen as a near-certain cut — is now back to roughly 50-50 pricing. The biggest market mover today will be the Doha outcome: a deal-saving result could see Brent toward $84.
The Monday calm has held overnight on the back of Burnham’s fiscal-rule continuity message. Bank of England rate-cut pricing for the 6 August meeting depends critically on what oil does post-Doha. Sterling positioning still leans defensive into the Labour-leadership transition. The Burnham “big building boom” positioning combined with the “No 10 North” devolution framework creates the underlying Labour-era policy framework heading into Q3. Zoopla data published Monday showed three in five homes listed for sale since January remain on the market, reflecting the ongoing impact of higher mortgage rates on the housing market.