FTSE Closes at a Five-Month High as Oil Tumbles
The FTSE 100 climbed to its highest close in five months as oil tumbled on the pause in the US–Iran war, easing fears of an inflationary energy shock. London’s blue-chip index rose 0.4 per cent to around 10,780, buoyed by lower energy costs, while Brent crude fell some 6 per cent into the high $80s. The pound was steady and gilt yields eased.
The relief rally, led by financials and cushioned by the retreat in crude, extended a run for the FTSE that has defied the geopolitical turmoil of recent weeks. Government borrowing costs slipped, with the ten-year gilt yield easing back to around 5 per cent, as the drop in oil strengthened the case for the Bank of England to hold interest rates when it decides on Thursday. Wall Street was more subdued, with technology shares weighing on US indices. Much still hinges on whether the Gulf truce holds. Watch the Bank’s decision and the oil price this week.