London: UK stocks traded cautiously on Wednesday, with the FTSE 100 holding largely steady as improving geopolitical conditions in the Middle East helped offset pressure from a global decline in technology and semiconductor shares.
By 07:25 GMT, the FTSE 100 edged up 0.09%, fluctuating between modest gains and losses throughout the session. Across Europe, Germany’s DAX slipped 0.65%, while France’s CAC 40 advanced 0.20%. Meanwhile, the British pound weakened slightly, falling 0.05% against the US dollar to $1.3188.
Investors also kept a close watch on developments in UK politics following the resignation of Prime Minister Keir Starmer. Discussions between Starmer and expected successor Andy Burnham continued as part of a planned leadership transition. Starmer is also scheduled to meet European leaders in Berlin later on Wednesday to discuss the Ukraine conflict, NATO defence spending, and the situation in Iran ahead of next month’s NATO summit.
Geopolitical concerns eased further as shipping traffic through the Strait of Hormuz showed signs of returning to normal. Tanker movements increased as fears of disruption linked to the Iran-Israel conflict subsided, reducing pressure on global energy markets.
The calmer outlook followed remarks from US officials dismissing reports that Iran could impose transit fees on vessels using the strategic waterway. However, mixed messages from Washington and Tehran underscored the fragile nature of the diplomatic progress.
Energy prices moved lower amid the easing tensions. Brent crude fell 1.22% to $75.86 per barrel, while US West Texas Intermediate crude declined 1.35% to $72.22. Precious metals also retreated, with gold futures dropping 1.14% to $4,102 and spot gold down 0.61% at $4,084 per ounce.
Despite the reduction in geopolitical risk, global technology stocks remained under pressure as investors reassessed sector valuations, contributing to a cautious tone across equity markets.
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