Oil has retreated to below $100 a barrel while stocks rise as Iran suggested it was open to striking a deal with the US, despite the collapse in talks over the weekend.
Even as the US began its blockade of the Strait of Hormuz, a wave of relief spread across markets as Donald Trump said Iranian negotiators were keen to strike a deal.
Iranian President Masoud Pezeshkian said the country was open to talks but only within the framework of ‘international law’.
Brent crude dipped below $100 per barrel to around $98, with Asian stocks up overnight and the S&P 500 closing above its pre-war level. The FTSE 100 is up 10 points at 10,595.
But the US is still playing hardball, going ahead with its blockade of the Strait of Hormuz, which came into effect on Monday afternoon (London time). Trump said the US would block Iranian vessels and any ships that paid tolls.
Vice President JD Vance said the US had shown ‘two can play at that game… If the Iranians are going to try to engage in economic terrorism… no Iranian ships are getting out, either.’
Elsewhere today, Rachel Reeves is in Washington DC for an International Monetary Fund (IMF) summit. UK growth forecasts have been slashed as higher energy prices take their toll, raising the risk of stagflation and recession.
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IMF slashes UK growth forecasts
Britain is facing the biggest hit from the Iran war among the developed nations, according to new forecasts from the International Monetary Fund.
The economy is expected to grow by just 0.8 per cent this year, some 0.5 percentage points lower than it anticipated in January. It makes it the biggest downgrade of all G7 nations.
The IMF issued startling inflation and unemployment forecasts, too, as higher energy prices batter households and businesses.
Read the full story below.
Morrisons plots more job cuts
Morrisons is reportedly eyeing up to 200 job cuts at its head office as part of its long-term restructuring plans.
The embattled retailer told staff on Monday that it was launching a consultation on job cuts as it plans to step up its use of AI, which will automate some tasks.
FTSE flat as oil inches towards $100
The FTSE 100 is broadly flat at lunchtime as oil inches higher to $99.20 a barrel.
Imperial Brands led the biggest fallers, down 6.7 per cent, after a disappointing update, dragging British American Tobacco with it, which fell 3.9 per cent.
Intertek has surged 12 per cent as it mulls a separation of its two businesses, followed by Metlen Energy and Fresnillo.
JP Morgan traders cash in on Iran war with record quarterly results
JP Morgan has reported record quarterly revenues as its traders received a boost from uncertainty caused by the Middle East conflict.
The US banking giant reported a huge jump in net profits in the first quarter – net income rose 13 per cent to $16.5billion in the first quarter, up from $14.6billion recorded in the same period last year.
Net revenue rose 10 per cent year-on-year to $49.8billion.
It came as trading revenue jumped 20 per cent to $11.6billion, the highest figure on record for the bank, as it cashed in on geopolitical uncertainty and volatility in markets.
Revenue from fixed income jumped 21 per cent to $7.1billion, ahead of expectations, while equity markets revenue rose 17 per cent to $4.5billion, ‘due to increased client activity’.
Intertek surges 11% as it mulls separation of businesses
Intertek is leading the FTSE’s biggest risers this morning after saying it had launched a strategic review that could lead to a separation of its businesses.
The FTSE 100-listed assurance, testing, inspection and certification (ATI) firm said it was looking at a spin-off of its Energy and Infrastructure division, either through a sale or demerger.
Chief executive André Lacroix said: ‘We believe that two specialist scale global ATIC businesses could be best positioned to accelerate growth and deliver greater value for shareholders.’
Shares are up 11.58 per cent to 4,260p.
FTSE 100 opens higher
The FTSE 100 opens 23 points higher at 10,597, regaining all of Monday’s losses amid renewed optimism of an end to the conflict.
London’s blue-chips have had a more muted reaction than Asian markets overnight. That might have something to do with brent creeping higher to $99.
Retailers boosted by early Easter
Retail sales in March rose by 3.6 per cent year-on-year, up from 1.1 per cent in February, boosted by an early Easter.
Figures from the British Retail Consortium (BRC) show food sales rose by 6.8 per cent, ahead of the 12-month average of 4.3 per cent, while non-food increased 0.9 per cent, below the average 1.1 per cent.
BRC chief Helen Dickinson said: ‘An early Easter provided a much-needed boost to food sales as families came together over the long weekend.
‘The disruption to international travel caused by the Middle East conflict also hit sales of travel-related goods.’
Analysts warn that sales growth is likely to slow in April and the rest of the year, though.
‘It is early days in the latest energy prick shock, and we think the bigger picture will be of slower consumers’ spending growth for the remainder of 2026 as inflation creeps up and disposable incomes are hit,’ says Pantheon Macroeconomics.
BP flags ‘exceptional’ quarter on higher oil prices
BP reported an ‘exceptional’ first quarter after the Middle East conflict sent brent crude prices soaring.
In a trading update, the oil giant said its oil trading was expected to return ‘exceptional’ results compared with a ‘weak’ previous quarter.
The price of brent has risen from below $60 a barrel at the start of 2026 to around $98 this morning, having hit as high as $118 amid the conflict.
BP said oil and gas production was broadly flat, while results in its gas trading division had been average.
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IMF cuts UK growth forecasts; Oil eases to below $100 and stocks rebound – MARKETS LIVE
